Knowing how much inventory to keep on hand is such a fundamental yet delicate part of supply chains. Gursh Atwal writes for Supply Chain Digital about how to optimize your inventory for the biggest gains.
Striking the Balance
Atwal says that your business’s operations, warehousing, and distribution strategy factor into optimization as much as the type of business and its role in the overall supply chain. Having the right IT system in place to support operations and analysis is your foundation. Increase your visibility as much as possible so that you can get the best hold on balancing capital investment, cash flow, meeting customer demand, supplying the production line, and supporting demand fluctuations.
Record and monitor data such as supplier lead times and seasonal fluctuations, which may mean employing a warehouse management system (WMS). Which solution you choose for WMS should be based upon the size of the company and the complexity of the supply chain. The result from these efforts should be an ability to reduce obsolete stock, stock with short lead times, and time-specific stock held to maintain operations. While there is no one-size-fits-all solution to fit every business, there are best practices to find the right solution in the easiest way. You can read Atwal’s full article here: http://www.supplychaindigital.com/supplychainmanagement/3542/How-to-optimise-your-inventory-for-supply-chain-success