As your business grows in complexity and you support multiple sales channels or global locations, accurate forecasting and planning become even more challenging – and mission critical to driving profits. How much inventory you hold depends on demand factors, supply lead times, manufacturing capacity, and your stock holding policies. Cutting it just papers over the cracks in the organization. A better way is to optimize your inventory.
If you’re using manual processes and guessing what and how much inventory to carry, there’s a better way. Find out how inventory optimization solutions from SYSPRO Enterprise Resource Planning (ERP) Software can help.
Inventory optimization is a high-wire balancing act for manufacturers and distributors. The process of objectively determining the right inventory levels for different products classes or SKUs, when to re-order and how much, from raw materials to finished goods – how do you decide what and how much to stock, when, and in what form?
On one side, you need to satisfy customers who expect product delivery at warp speed. You may also want to hedge against cost volatility by stocking higher quantities. On the other side, keeping products and materials on the shelf can be really expensive. In manufacturing, as much as 50% of your capital can be tied up in inventory.
If you have an ERP like SYSPRO, you have the software and the data to give you a data-driven solution, rather than relying on rule-of-thumb or guess work. Discover how SYSPRO’s inventory optimization solutions empower your team to solve these challenges. Forecast and control over what’s in transit, at the warehouse and on the shop floor – so you can identify issues before they occur. The payoff can be significant:
Reduce carrying costs to
In your business, you need to purchase raw materials wisely, taking into account issues like seasonality and favorable purchasing terms. SYSPRO ERP Software provides advanced forecasting, demand planning, and modeling with “what-if” capabilities that show the trade-offs related to inventory and fulfillment time.
In addition, SYSPRO enables you to conduct an analysis of stock codes (SKUs) by multiple algorithms at a granular level, so you can see each item’s historical demand behavior and impact on profits. Then you can create segments and balance ordering based on that behavior – basic, seasonal or safety stock.
No history? SYSPRO’s proxy functionality enables you to forecast demand for new products based on the sales history of similar superseded products – particularly useful in industries where product life cycles are short.
With SYSPRO’s integrated scheduling, inventory forecasting and Materials Requirements Planning (MRP) solutions, you can order just what you need in response to demand, reducing both costs and waste. This functionality is complemented by features such as “available-to-promise” and various time fence indicators, which give sales and production staff a reliable view of what they can promise to customers and when.
In addition, SYSPRO ERP Software features advanced business analytics reporting so you can analyze KPIs such as lost sales, days of stock cover and days out of stock. When you identify slow-moving, excess, active and static stocks, your sales team can then create targeted promotions, and your operations team can accurately handle obsolescence provisioning.
With SYSPRO Inventory Optimization connected to our MRP solution, your team can use demand forecasting to calculate budgets and targets for purchasing raw materials. You can develop ordering policies by stock code at the warehouse level, and then calculate time-phased minimum and maximum levels dynamically based on demand forecasts. With set targets, you can further improve efficiency by automating processes like standard reorders.
When you have real-time access to inventory information, you can pinpoint and address issues quickly before an out-of-stock situation occurs. SYSPRO ERP Software can show you where and why inventory is not in balance (excess or shortage), with tracking signals to indicate when forecast accuracy might be in doubt. You can also leverage alerts to automatically notify you of supplier issues, so you can speed up resolution.
As a result of this implementation, Norman Good Fellows has complete visibility of their profit per customer, supplier and product. ‘Live’ stock views have improved customer service levels significantly due to decreased stock outages.
Download this Infographic to get a visual view of SYSPRO solutions for chemical firms and how they can support your operations across.
SYSPRO Inventory Optimization takes an holistic approach to balancing the supply chain by providing visibility and understanding of the different parameters that create and shape inventory.
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