Category Archive

Supply Chains of your business A reader has asked which of the many elements of supply chains should be emphasised as companies take steps to change the objective of supply chains from ‘cost down’ to ‘value add’, in an era of disruptions? While each business will select its own list of short-term ‘to do’ actions to achieve improvements, there should … Read More

Inventory for dependent items The role of Inventory is to provide a buffer that recognises variability in demand for items and the lead times required to meet those demands. Variability in supply and its lead times is also a factor, due to disruptions through supply chains. The disruptions in supply chains are likely to continue, especially with the influence of … Read More

ABC inventory approach Inventory is too often considered as one lump of cost, rather than as a collection of individual stock keeping units (SKUs), each with their own pattern of demand and supply. To provide some differentiation between high and low selling items, a familiar process is to group SKUs into ABC groups. This is based on observations by the … Read More

Cost of holding inventory There is not a ‘right’ decision about the level of inventories that work best for your business. However there is a need to know the cost and potential for cost reduction from decisions about inventories. To cover for unplanned events, an organisation can reduce its total operational costs by holding a calculated ‘safety stock’ in excess … Read More

Slowing sales and rising inventories Reports concerning retail product sales in various countries indicate a slowing rate of sales growth as consumers are again able to access services. For all businesses in product supply chains, this will provide a challenge for managing inventories. An example of the challenge is a major online non-food retailer in Australia which has experienced a … Read More