Most companies develop plans and goals each year to improve inventory performance– their inventory turns, reduce their inventory by x dollars, reduce lost sales by x percent… but they have difficulty each year actually achieving this.
Usually during inventory analysis companies apply pressure to their inventory buyers and planners to do a better job. They may identify specific projects (reducing obsolescent inventory) that create one time wins in those metrics. However the regular and ongoing replenishment process remains unchanged.
We believe that you must measure your inventory performance on key supply chain analytics to know where you are now, and then have systems in place that allow you to adjust your desired service levels, and calculate simulated results of your inventory levels, inventory turns and other key metrics. By using a system like Thrive’s for inventory analysis, you can adjust the throttle and the system ratchets inventory up or down based on your desired service levels.
Utilizing Thrive’s Inventory Management Software for Inventory Analysis
We start off with an analysis of your current supply chain analytics to establish a baseline.
Then you actually ‘engineer’ your supply chain plan in Thrive. Since Thrive projects your forecasts and projected inventory balances and recommended orders 12 months into the future, Thrive can model the impact of your plan on your future inventory and identify potential gaps or issues you may have to address in order to achieve your goals.
Then once the supply chain plan is configured, and the modeling shows it to be a workable plan, Thrive uses your plan as the basis in how it calculates your forecasts and tactical inventory buys and stocking levels. In other words, your strategic business goals are now connected to the inventory buying tactics. And then with inventory analysis and metrics, it shows your progress towards those goals each day.
What is Self Evident Inventory Performance?
Self evident inventory performance means that the system monitors itself to achieve your key goals, and displays its progress and trends versus your goals. The system also ‘senses’ if there are issues arising. Lead times becoming irregular? A vendor struggling to deliver on time? Lost sales trending up?
Configurable, Powerful Platform
Thrive provides extensive Supply Chain Analytics as part of the application, plus the ability to easily modify existing reports, dashboards, and graphs or set up new ones. Thrive also provides inventory analysis Services for companies who have specific analysis projects.
Inventory is like a living thing in that it can change quickly within days – Thrive alerts buyers and planners to proactively discover and resolve potential issues before they would normally be detected.
Thrive Supply Chain Analytics helps managers ensure inventory policies and practices are hitting strategic goals, and will provide drilldown detail if there are issues. For example, it will notify managers when metrics like inventory turns drop below a user defined tolerance for a product family, or when service levels have dropped for 3 straight weeks in a row.
Inventory Performance Key Performance Indicators (KPIs)
Thrive calculates and displays inventory performance KPI’s so you can monitor and proactively manage your inventory performance. Some sample metrics include projected inventory turns, service levels, safety stock dollars, lost sales dollars due to stockouts.
Out of Stocks + Overstocks
Out of Stocks are due to a finite number of reasons. Thrive Supply Chain Analytics will tell you why you are stocking out. Is it because your buyers are not placing orders in a timely fashion? Is it because your vendors are not delivering when they say they will? Is it because you are having a lot of unpredicted large sales? Thrive Supply Chain Analytics analyzes which items are overstocked and why. Are the buyers buying too infrequently? Is it because the vendor minimums are very large? Thrive tells you which vendor MOQ’s are causing you to buy too much supply. Thrive can also tell you if the sales forecasts you incorporated into the buying decisions were highly overstated.