Inventory optimization - With consulting to lower inventories
Inventory optimization is the ability to manage inventory. In other words, a company must have the right inventories so that the targeted service levels can be achieved and at the same time as little capital as possible is tied up in inventory. Volatility in terms of supply and demand must be taken into account. It is important to know that inventory optimization is an ongoing process that entails permanent observations and adjustments. The aim of inventory optimization is to cover fluctuating market requirements by controlling and planning the value creation processes.
Inventory optimization makes sense at any time, but varies from company to company. In order to reduce inventories in an economically sensible way, it must be known which factors have an influence on inventories. Since many companies have a lot of money tied up in inventories, these sums are not available for investment. In these cases, reducing inventories can reduce costs and free up capital at the same time. This alone shows you that inventory optimization always makes sense.
With the SOP – the Start of Production – the factory planning is followed by the ramp-up support, which is to ensure the achievement of the targeted capacity utilization by successively increasing the production load. This is done by fine-tuning production logistics and stabilizing production processes. In addition to the support of the production systems, the object support and documentation is carried out.
Inventory reduction in practice
Inventory levels should be analyzed, controlled and subsequently optimized on a daily basis. In order to find out the optimal inventory, a sales forecast must be created – and this must be done daily for each item. This is done by calculation with existing data. In this way, excess stock and excess orders are displayed. Shortages, on the other hand, can be identified via the sales forecast. Optimized delivery ensures that delivery capability and customer service improve and sales increase in the long term. Particularly important for inventory optimization is the dynamic safety stock, which is linked to factors such as service targets, sales risks, supplier risks and sales trends.
Optimal stocks with Bross Consulting Engineers
We offer valuable approaches in combination with advice on the latest software for warehouse management as well as in the planning of warehouses per se in compliance with all applicable guidelines. Let’s explore together ways so that through inventory optimization your company remains/becomes competitive.
Your contact person
Dr. Florian Bross
Contact us on the subject of inventory optimization
We at Bross have been providing our expertise in optimizing inventories to our customers for many years. We look forward to your inquiry!