Does your business rely on inventory? Then there are quite substantial savings to be made with improved inventory management. Reduce inventory cost and reap the benefits.

This comes from two directions:

  1. Reduce the total Inventory you hold. Thereby reducing the amount of Working Capital tied up in Inventory.
    Reduce your debt and associated interest charges.
  2. Stock outages can be reduced permitting you to sell more.
    Logic tells us that the most likely stocks to run out are the ones that are popular and therefore fast selling.
    Not having them in stock to meet demand is shooting yourself in your (Profit) foot.

For a detailed process to reduce Inventory cost go to the article: Inventory Re-order Management for Profit and Productivity

The article covers the following areas, plus more, go to it and reduce your business inventory cost:

So what is important with Inventory Cost Reduction?

  1. Performance measurement is important. But ensure that you measure it in a way that creates a smooth flow through your business production system.
  2. Focus on supplier relationship and the importance of a system, an effective system allows you to restock frequently.
  3. Go to the TOC Demand-Pull system section.

Do the simulation case study, have some fun and test the difference between the Min-Max system and the TOC Inventory system.

Finally, you are presented with Case Study results and Real World examples. The examples highlight the different characteristics of the 2 systems.

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