Introduction Scan features Working capital reduction Product availability The supply chain paradox SKU classification and product life cycle management Safety stock and excess stock Smarter replenishment Inventory Optimization Recommendations The DSV Inventory Scan process Identifying opportunities for improvement Working capital reduction Every supply chain team must balance inventory levels with product availability. Without the right balance, excess inventory accumulates throughout the supply chain and ties up vital working capital. Companies often attempt to manage inventory based on a ‘rule of thumb’ philosophy or using their enterprise resource planning (ERP) system. This approach leaves companies vulnerable and unable to cope with demand uncertainty, supply volatility and the interdependencies between nodes and tiers of the network. Inventory optimization (IO) can have a huge financial impact by minimizing inventory and freeing up working capital while guaranteeing the right stock is on hand, when and where it is needed. Main metrics scanned Capital in stock. The total value of the stock as well as the inflow and outflow of value at any given time interval. The metric can also be displayed as an average over the year and can be filtered, e.g. based on SKU category (A, B or C movers) Stock rotation. The value of the outbound SKUs (products sold) divided by the average value of the total inventory calculated over the past 12-month period. Value density. The average product value on a full single-SKU pallet and the evolution of this metric over time. Receivables Finished Working Goods Inventory Capital Cash Raw materials Inventory Click image to enlarge
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