Thrive CEO Rick Morris Discusses Correlation Between Forecast Accuracy and Inventory Profitability
Marietta, GA – December 4th, 2014
The CEO and founder of leading demand forecasting software provider Thrive Technologies is featured in a guest editorial regarding the direct correlation between inventory forecast accuracy and distributor profitability in the November 2014 edition of the Supply House Times publication. Supply House Times is the official publication of the American Supply Association, a national organization serving wholesale distributors and their suppliers in the plumbing / heating / cooling /piping (PHCP) and industrial pive / valve / fitting (PVF) industries.
Rick Morris, Thrive Technologies CEO, provides research on how higher forecast accuracy is correlated to higher fill rates and lower inventory levels, and offers step by step instructions for companies to start measuring their own forecast accuracy.
Morris, a Certified Supply Chain Planner and a 2014 Supply Chain Pro to Know, shares analyst studies that show how companies who had high levels of forecast accuracy as a foundation of their inventory management were able to experience 15% less inventory, 90% fewer stock outs and 2% higher profit margin than their peers.
“Regardless of what technology or software is used,” Morris states, “it is so important for distribution companies to start measuring and monitoring forecast accuracy as a Key Performance Indicator if they are serious about improving profitability.”
“Manufacturers have focused on inventory efficiencies for years,” Morris added. ”Distribution companies stock much larger and wider selections of SKU’s often at multiple warehouses and branches. Meanwhile they operate at lower margins than many other industries. And yet they have relied on the inaccurate forecasts from their ERP systems for years. Getting better predictions of what they are going to sell in the future is now relatively easy and inexpensive to do but distributors often underestimate its impact on their profitability.”
The article called ‘The Crystal Ball” can be read at here.
Thrive Technologies is a cloud-based, SaaS (Software as a Service) provider of inventory forecasting software. They run their patent pending demand forecasting software in the cloud to attain forecast accuracy over 90% for their clients. Thrive can interface with nearly all ERP systems, regardless of platform (Windows Server, Unix, iSeries, custom,etc.) including Epicor Eclipse and Infor SX.e. Thrive is designed to calculate and monitor forecast accuracy by SKU by branch.
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