Setting inventory levels that meet customer demand is a key challenge that organizations face today. A key concern for global manufacturers is reducing inventory and the costs associated with it. Inventory Optimization helps manufacturers control inventory driven costs and address demand volatility and supply chain complexity.
Despite the significant impact that inventory management can have on a company's performance, many companies continue to rely on basic, ineffective inventory policies. Some of the key issues that drive the need for Inventory Optimization are high stock-outs with high inventory levels of the wrong products, high demand uncertainty and shorter product life cycles, a supply chain network without a clear visibility across different levels, changing market conditions, supply chain constraints and buying behaviour, poor or inadequate customer service levels, inventory levels across procurement, manufacturing and distribution
The Indian market faces additional issues such as inadequate transportation and logistics infrastructure, state and national tax laws, and fragmented supply base which do not complement maintaining optimal inventory levels at all times. However, certain leading organizations have taken up the challenge of creating robust systems that help them in managing their inventories efficiently. This has made them realize huge savings in terms of having the right items to be shipped, reduced back orders, and improved customer service levels.
ThinkLink Solutions for Inventory Optimization help companies in controlling their inventory costs and formulating effective strategies to further optimize their inventory levels. By effectively analyzing the supply chain structure, demand variability and lead-time fluctuations we help clients achieve meaningful results. We evaluate the potential benefits of different inventory optimization scenarios that could bring to your organization. To provide insight into your firm's savings potential, we analyze your current inventory planning methodology, systems, and processes for opportunities to reduce working capital and improve performance.
Our Inventory Optimization approach will help you answer the following questions:
- What are the most critical shortcomings or issues that should be addressed for achieving highest gains in inventory holding?
- What opportunities exist to reduce the working capital and improve customer service levels?
- Where do we stand in our inventory optimization compared to the industry leaders?
- Do we have the right systems in place to support advanced inventory optimization techniques?
- How do we plan inventory so that the stock obsolescence is minimized?
Typical benefits realized by clients after implementing our Inventory Optimization Solutions include:
- Reducing inventory levels by 10 – 30 per cent
- Increasing service levels above 98 per cent
- Achieving ROI in 6 - 12 months
- 17 – 20 percent stronger perfect order fulfilment
- 35 per cent shorter order-to-cash cycle times
- Reduced carrying cost because of better planning
- Lowered inventory obsolescence rates