Supply Chain Management Consulting
Inventory Planning and Deployment Strategy
Overview
Knowing how to manage inventory position and deployment is as important as determining how much to inventory to maintain and where to stock it. As the company shifts its manufacturing or distribution strategy, the inventory positioning and deployment strategy should be realigned. Different customers or product lines may require different supply chains and inventory service requirements. Inventory Position and Deployment Strategy is about deciding how best to manage inventory to support customer delivery and supply chain operations in the most efficient and effective manner.
Business Problem
Are you experiencing these business challenges? Do these questions sound familiar?
Common Business Challenges
• Changing manufacturing strategy; build-to-stock vs. postponement
• Changing distribution strategy: consolidated vs. fragmented
• Changing supply chain network design
• Need to rationalize inventory stocking locations
• Difficulty rebalancing inventory across the network
Key Questions for Consideration
• Which products should be stocked centrally and which should be stocked at all locations?
• Can we consolidate our inventory storage and take advantage of inventory risk pooling?
• If we transition from a build-to-stock to postponement manufacturing or configuration strategy, where should inventory be positioned? In what form should inventory be stored?
• Should we stock product in our distribution network or have our supplier drop ship product directly to the customer?
• How much should we order and when should we place an order from suppliers? What is the projected impact to inventory position?
Service Solution
Supply Chain Acuity’s Inventory Positioning and Deployment Strategy service helps our clients keep their inventory strategy in sync with its manufacturing and distribution strategy. We analyze demand and supply variability, segment inventory based on a number of characteristics, and build an inventory profile. With analytical insight we can identify and quantify improvement opportunities to align inventory position and deployment with manufacturing and distribution operations, and improve supply chain planning. Combined with Network and Inventory Optimization services, we understand supply chain structure, process and inventory dependencies contributing to total costs.
Example analysis may include:
• Inventory risk pooling
• Inventory segmentation and classification based on a number of characteristics
• Product modularity
• Changes to inventory form factor
• Alternative fulfillment and distribution strategies based on inventory segmentation
• Inventory replenishment plan and inventory projection
Delivered Benefits and Desired Outcomes
• Improved fulfillment and customer service delivery performance
• Reduction in safety stock and total inventory investment
• Increase inventory turns
• Reduction in working capital
• Reduce risk of excess inventory and obsolescence
• Improved inventory flexibility from raw materials to work-in-process to and finished goods
• Inventory alignment between supply chain planning and operations to drive cost efficiencies