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Category: Inventory Optimization & Management

Learn more about inventory management as we share insights on forecasting, inventory planning and inventory optimization designed to help companies achieve exceptional business outcomes.

Improving warehouse inventory management

Warehouse inventory management is one thing that can have a big impact on productivity. All Things Supply Chain put together a list of 9 ways you can better manage your inventory. First things first, plan your space. As they said, [...]

The Future of Inventory Management: Five Predictions

For many companies, inventory management is where all the elements of the supply chain converge. Inventory may be seen as the bloodstream of any competitive business. Its unobstructed flow is critical to the well being of any organization that trades [...]

Is Poor Inventory Management Creating Chaos in Your House?

Planning for changes in demand for product is a situation everyone deals with. It’s not just a corporate issue either! At work, at home, in almost every space, there is a need for products, and those needs (demand) change due [...]

MRP & Inventory Management

Most companies use Material Requirement Planning (MRP) software, or an MRP module of an ERP, to plan and manage the purchase, production, and transfer orders of finished goods and components based on a demand plan or forecast. It is time-phased [...]

Excess & Obsolete Inventory is a Recipe for Disaster

Inventory is an ongoing challenge for companies -- especially inventory that's considered outdated and over-stocked. The issue is caused by a series of unfortunate events, including lack of communication, not applying the true cost of inventory, poor end-of-life planning, lack [...]

What CFOs Don’t Know About the Cost of Inventory

Whether based in retail, distribution or manufacturing, supply chain processes are the backbone of the company. If you can’t provision orders, your bottom line will suffer. Perhaps this seems like an obvious statement but many an organization has brought process [...]

Critical Facts CFOs Need to Know Before Reducing Inventory

In an effort to free up cash, many financial managers are all too eager to reduce inventory. However, taking steps to reduce inventory without being fully aware of the context can lead to disastrous outcomes.   CFOs need to be [...]

How Inventory Optimization is a Lot Like Dieting

We all know what to do and what not to do. The key is to develop a plan—and stick to it. A new year is upon us and you may have made a personal resolution to get in better shape. [...]

Why You Need Dynamic Supply Chain Planning to Compete

A recent Reuters article headlined “U.S. department stores tap brakes on stocking for holiday season” points out that “Macy’s Inc, J.C Penney Co Inc, Kohl’s Corp, Nordstrom Inc, Dillard’s Inc and Hudson Bay Co’s Lord & Taylor are among the [...]

The Value of an SKU?

Very recently we got a phone call from an old colleague who works for a home decor company. He was about to go into a meeting with the executive committee where he was going to propose an SKU management process. [...]

Operational Definitions Part II

In part I of this two part blog we discussed Operational Definitions and how specific words, terms or concepts can have a distinct meaning in a specific organization or business and how people must be aware of this when communicating [...]

Operational Definitions

Operational Definitions were a large part of what W. Edwards Deming used to advocate in his teachings. Chapter 9 of his book, Out of the Crisis is dedicated to this concept. “Operational Definitions, Conformance, Performance.” In the opinion of many people [...]

What is Activity Analysis? Part 4, The People Dominant Process

We believe that inventory is the final arbiter of supply chain performance. To get it right takes more than just good clean data and using the proper calculations for Demand Planning, Inventory Sizing, and Manufacturing Planning. It requires well conceived [...]

What is Activity Analysis? Part 2, Warehouse Layout and Re-Layout

Last week we posted a blog about Activity Analysis, we learned this is basically the task of delving into and capturing the complexities and nuances of whatever complex process you are attempting to manage or improve. Now let us consider [...]

What is Activity Analysis?

In the world of Inventory Management, there are many classes of inventory. A key component of a robust inventory management process is to define, segregate and measure, from there we need to develop and implement action plans by the various [...]

A Quick Inventory Opportunity Assessment

When we meet with a company for the first time, we like to ask three simple questions to allow us to make a quick assessment of their inventory status.  We ask: What is your revenue and gross margin? What is [...]

Don’t be Naive About Inventory Management

For the first part of this posting, you have to pretend that it is 1975 and not 2011. You are given a mandate to reduce inventory by 10%. The totally naive thing to do would be to cut inventory across [...]

Variation and Inventory

No one wants to hold inventory. It is necessary because of variation: variation in demand, variation in lead times, variation in raw and finished good quantity, variation in yield (production line reliability), variation in transit times, and of course random [...]

The E&O and Inventory Turn Relationship

At Cadent Resources, we are dedicated to helping small- to mid-sized manufacturing and distribution companies better manage their planning and inventory. We try to do that using simple concepts, intuitive tools, and straightforward processes. In our work with clients, we [...]

Inventory as a Percent of Sales

If you are focused on optimizing inventory, another useful measure of inventory or working capital is the ratio of inventory to sales or inventory as a percentage of sales. It is a very simple and easy to calculate KPI. It [...]

How Much is Increasing Inventory Turns by One?

There has never been a good answer to this question. We have asked our partners in finance and they just gave us a blank stare and did what finance people always do. They asked “Why do you want to know [...]
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