So what can Advanced Inventory Management do for me?
An approach that puts you in charge
micq-if can potentially help you deliver benefits across many areas. Importantly it can help you choose where you can save and where perhaps you should invest. Ultimately the choices however are up to you.
Unlike many packages which adopt simple inventory management practices like ‘days’ or ‘months of stock’, micq-if can employ an array of approaches which handle the complexity of real supply chain issues. micq-if can be tuned via a series of policies that you set, at whatever level is appropriate: overall, for a state, for a class of products or perhaps one warehouse or store. You decide how you want to manage your supply chain and your product range and micq-if can handle the millions of detailed decisions that flow from the policies and rules that you set.
Many possible benefits
So what sort of benefits might be possible?
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How achieved
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Reduced inventories (in the right places)
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micq-if has been known to reduce inventories for some products in some warehouses by up to 80% relative to some ‘one size fits all’ type approaches. However micq-if is also just as likely to increase inventories appropriately if needed. It is too easy to cut back across the board and produce some short term ‘benefits’ but these can often compromise your service levels, your reputation and your gross margins. micq-if can help you discriminate and decide on where best to save and where perhaps you should invest more.
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Reduced emergency orders (less airbags, courier charges, time taken to track emergencies and handle customer anxieties)
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If your customers need it now, then you have to get it now. But if it is not in stock that means phone calls, special picking, shipment, receipting, handling and follow-ups … a big hit to productivity. Every air bag might cost you $6 but the real cost is probably three times that when you add in all the impacts to productivity. And relative to a product sourced via normal replenishment a product that to be transferred on an emergency basis, will often cost four to eight times more. micq-if can help you ‘optimise’ your product range across your stores and warehouses so that you stock in the ‘right’ quantities and reduce your emergency transfers. That may mean 'emergency' transferring large or long lead time orders when appropriate but stocking matched items in the 2s or 4s in which they are sold at others. micq-if can help you make the right choices more often.
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Improved productivity
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Your branch / store staff will probably be happier as they can serve customers more easily. But so too:
- Replenishments and receipts are typically smoothed because micq-if can help you dispense with old ‘buyer’ practices which cause surges and spikes in stock movements.
- Reduced workload in purchasing, enabling you to focus on what really needs to be reviewed and in also increase the responsiveness of your purchasing process, enabling more frequent ordering (and reduced inventories).
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Improved margins
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For the more exotic products do your customers think of you first? Do they even think you might be worth talking to? If they don’t it could be your poor service reputation means that they only speak to you after they have given your competitors the opportunity. What does that do to your gross margin?
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And there are more potential benefits:
- Standard abilities to track and react to key supply chain variables, like supplier lead times and reliability, providing you with the analyses you need to stay on top of your business.
- Rapid identification of any stock deficits, so you can take the right recovery actions as quickly as possible.
- The tools and techniques to more easily stay ahead of the business cycles.
- Managing rebates so that you gain the benefits offered by supplier incentives without over ordering and creating excesses which take a long time to work out of your inventory.
- Planning what you should order in the next container shipment, so that you can optimise ordering, transport and stock carrying costs.
- Automatic identification of any stock excesses and movement to more appropriate warehouses … running business cases on any excess stock situations every night, helping you to ‘control’ the inevitable imbalances that will occur. micq-if will not make your inventory management perfect. However it will help you get a lot closer to optimum performance.