What are the best practices for managing inventory costs during growth?

For near future forecasts, Damand Sensing may be a useful technology and methodology. This approach differs from traditional Demand Planning in that it utilizes real-time data, AI, and sensors to monitor current market conditions and adjusts forecasts on the fly. This agile approach is especially valuable for industries with rapidly changing demand.

Acredito que ter uma matéria-prima de qualidade traz grandes benefícios pois terá menos problemas com devoluções, e falhas no processo. Entendo também que garantir um sistema sólido de gerenciamento de estoque, com um software adequado e um bom time, faz toda diferença.

In my experience as a SIOP lead if you concentrate you efforts on a full repeatable Demand Review cycle then you can mitigate a lot of the risk. You should be fully engaging with both your sales and marketing teams during this part of the process, pair this with good statistical forecasts and a forecast accuracy measure like MAPE then you can’t go far wrong. Of course things happen so it is a good idea for you to have a firm stocking strategy in place which is of course dependent on your proposition to the customer. Ensure you use your MRP / ERP system to its full potential and use Min and Max’s level to keep your inventory in check.

#Forecasting is always wrong! We cannot avoid its criticality though. Its always a triangulation of #Warehouse, #Procurement and #Business guys where all are correct in their own way. Warehouse wants safety stock, Procurement wants economy of purchase and Business wants lower order execution lead time. So much of #Bullwhip all the way. Trend, Historical, Seasonal analysis and above all coordination of different stakeholders can really healing if can be managed through runtime data where #Technology is MUST. Failure to that always end up with CASH burnout though holding or disposal end each cycle count.

In my experience, it makes sense to keep a running forecast using real-time data to avoid over-planning your inventory quantity and overstocks in season. Always err on the side of not enough inventory. A very wise old retail pro taught me at the beginning of my career, "it's better to fight for merchandise than to fight with merchandise". It's the best advice I've ever received.

ABC analysis done on operations and the supply .AI interfaced to foster Risk factors.between the upstream and down stream.cost effective suppliers that have excellent financial position and deliver great performance.

Inventory turnover is important for a number of reasons First, it can help companies to identify and reduce inventory costs Companies with high inventory turnover ratios typically have lower inventory holding costs, such as storage costs and insurance costs Second, inventory turnover can help companies to improve their cash flow. When companies sell their inventory more quickly, they generate cash more quickly This can help companies to meet their financial obligations and invest in new growth opportunities Third, inventory turnover can help companies to improve their customer service. When companies have a high inventory turnover ratio, they are more likely to have the products that their customers want in stock when they want them

A one-size-fits-all approach may not be ideal. A company sustained a high turnover ratio of 12 for many years due to efficient local sourcing. However, this led to occasional stockouts. Management responded by increasing safety stock across the board. The turnover rate was reduced to 4. But carrying costs were raised significantly. The increased safety stock tied up a substantial amount of capital. The strategy increased operational expenses. In conclusion, a one-size-fits-all approach may not always yield the desired results. It's essential to assess the unique dynamics of your product portfolio and market conditions to determine the most effective strategy for optimizing inventory turnover while managing the associated costs.

In medium large copany where is still supply chain ideology not yet developed, in those company there is much critual to implement to assume demand forecast. Management & concern person who is dealing with the process those people need to aware of basic forecasting process as well as management also need to in consideration that demand forecast is just an assumption not perfect.

Inventory turnover is most crucial. The business is business. The boss is the bottom line. Get it in and get it out. I prefer FIFO. Consistent inventory turnover allows your to efficiently forecast and make money on a schedule.

Another factor that affects your inventory costs is ethical leadership. Strong and ethical leadership is essential in implementing inventory control systems to ensure that they are not only effective but also aligned with the organization's values and principles. Ethical leadership promotes integrity, transparency, and responsible behavior, which are critical for maintaining trust, minimizing risks, and achieving long-term success in inventory management. It is also fundamental for making informed decisions based on reliable information. Leaders who prioritize ethical behavior discourage manipulation or falsification of inventory data, which can lead to costly errors.

Identify the importance of accuracy and consistency. Train your team accordingly on proper inventory SOPs. Conduct daily and weekly monitoring to ensure that your business remains in line in conjunction with its demands. Set appropriate pricing and monitor product sale performances often.

Procesos de conteos cíclicos y establecimiento de prioridades de conteo mediante un pareto de rotación garantiza que el inventario siempre esté correcto, lo que en consecuencia genera una garantía en los procesos de surtido, compra y rotación haciendo más eficiente la cadena de abastecimiento

You shouldn't raise safety stock across all items. Identify the High Velicity (units) and High Volume (dollars). Set criteria based on what percent of sales these items represent to total sales. Invest additional inve tory of these items to insure consistent availability. Analysis will most likely reveal that a small percentage of items produce a high percent of sales.

Implementing effective inventory control systems is crucial for managing stock levels, reducing costs, and improving overall operational efficiency. Implementing effective inventory control systems requires a combination of technology, standardized procedures, and a commitment to ongoing improvement. Regularly assess and adjust your systems to ensure they remain aligned with the evolving needs of your business.

É de suma importância a implantação de um sistema WMS (sistema de gerenciamento de armazém). Existem no mercado ótimos softwares ERP para atender as demandas logísticas. Sem controle dos estoques, assim como a falta da medição de seus mais importantes indicadores, a sobevivência de uma empresa pode ser comprometida. Estoque é dinheiro e dinheiro precisa ser bem cuidado. Nos tempos modernos e com tantas ferramentas modernas e acessíveis para cumprirem tal tarefa, é estritamente ter um bom software que nos ajude nessa missão, afinal a velha e boa planilha de Excel nem sempre nos atende com a robustez necessária quando falamso em larga escala e colaboratividade.

Be realistic and understand your business demands. Track product performances and order as needed. Update any product pricing based on invoices that arrive and ensure that you’re receiving the most competitive price for the product that your order. Set purchasing budgets that are relative to your overall sales. Lastly, hold your team accountable by implementing mid and end of the month inventory audits to ensure your cost of goods remain in line. Consistency is key.

Categorization of Inventory as Fast ,Slow and Non moving would help. Analyzing sales performance and factors contributing to low/slow sales would also help. Few common reasons for slow movement of inventory are- Non availability of inventory at stores/retail outlet, high product cost,availability of alternative product in the market etc. In a nutshell- Data analysis will be the game changer on Inventory Performance.

If you can't measure it you can't fix it. Seeking indepth analysis and feedback from customers to meet what they need and what they value will help to secure the growth in terms of value, volume and market penetration

Analyzing inventory performance is crucial for making informed decisions, optimizing processes, and ensuring that your inventory management aligns with overall business goals. By systematically analyzing inventory performance using these steps, you can gain insights into the effectiveness of your inventory management strategies and make data-driven decisions to optimize performance over time.

Seeking continuous improvement is a mindset and a process that involves regularly evaluating and refining your operations to enhance efficiency, quality, and overall performance. By incorporating these practices into your organizational culture, you can create a dynamic and responsive environment that is committed to continuous improvement across all facets of your operations.

Siempre tener en cuenta que no hay proceso que no sea susceptible a mejora, y ya que este funcionando eficientemente, esto lo que quiere decir es que hay que apuntar a nuevos KPIs o generar una nueva medición estresando de manera positiva la operación en la consecución de mejores resultados

Gerenciamento de estoque permeia por muitas situações de alterações constantes aplicação de novas ferramentas e conceitos de trabalho ajudam na melhor administração do tempo, qualidade e custo operacional além de ser algo necessário para se manter competitivo no mercado atual. Investimento em treinamento da equipe para se ter mão de obra qualificada, investir em estrutura e novas tecnologias.

There are a few prospective which would be really interesting to be considered like having a JIT(Just in Time) inventory system to ensure enough material is available in X amount of time. Secondly alternative vendor management plays a pivotal role in avoiding miss on production/supply timelines. Tech support and advancement at the vendor site give real time understand on the availability

I went through this in my business. Scenario: Sales shot up. Customer count increased. Spending increased. Ego became unchecked. I became unfocused and unclear about my direction. Invoices became lost/ were unfollowed or simply not imputed. Staff became disillusioned. Learning: Allocate tasks. Ask for clarity and help. Simplify and share knowledge. Have a plan. Set a goal. Give your bank/ CEO or advisor a call. Talk to people who can help you. Lesson: I couldn't see the forest from the trees. I now understand that I couldn't control everything. But that I needed to step back a little to see the whole picture and not little by little and not do everything ad-hoc.

Understand your market and demographics. Ensure you’re comparable to your surroundings and be mindful of your customer feedback. Are you too pricey? Can you come up a bit without being too steep? Ensure customer service remains at the highest level as that plays a major role in value factor. Never forget how to be a customer.

"Keep your friends close and your suppliers closer." Building close relationships with your suppliers and effectively negotiating with them can significantly impact your inventory costs. As your business grows, engage with your suppliers to explore cost-saving opportunities. This can involve negotiating better pricing, bulk discounts, and favorable payment terms. Positive relationships with suppliers can also improve lead times reducing the need for surplus safety stock. Collaboration can help you stay informed about industry trends, allowing for better-informed decisions about your inventory needs. Keep open lines of communication.

Effectively managing inventory costs during growth involves key strategies like regular audits, supply chain optimization, accurate forecasting, ABC analysis, maintaining safety stock, efficient ordering policies, technology integration, supplier negotiations, cross-functional collaboration, employee training, and continuous improvement. These practices collectively help navigate inventory challenges during periods of growth.