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3 Tricks to Fix the Bullwhip Effect and Smooth Inventory Replenishment

A Bullwhip Effect Creates Waves of Inventory Issues

Demand forecasting can eliminate a lot of your “wave riding” activities in supply chain planning. Your company invests significant resources, time and money, in planning and executing inventory replenishment and promotional events. You often experience service problems when your suppliers don’t have inventory in place to support your business. The suppliers operate their supply chain independent of yours and forecast demand from your purchase orders. This sales forecasting approach has a silo effect on information; your partners don’t get an accurate view of the end consumer’s demand. When suppliers see order quantities changing, up or down; how do they interpret the signal? Sometimes they view changes as trends or lumpy demand, and react by changing their production or inventory plans. This results in a wave of over-reaction called the “bullwhip effect.”
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Inventory Optimization Pieces that Disable Your Success

Inventory Optimization: Balance is Key for a Success

How can you ensure the highest levels of success? Merchandisers and Buyers are executing promotions, product assortment changes, and new product roll-out events throughout the year. Those events affect the flow of product into your DCs and stores. They can also affect vendor fill rates and lead time performance. The volume of product purchased from a vendor also changes with those events. Unless you monitor and adjust to those changes, you will lose margin and sales. Inventory Optimization solutions provide value by monitoring the on time performance and volumes of your suppliers and allow you to make adjustments along the way.

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Supply Chain Visibility: Are you Running the Race End to End?

How Visible are the Links in your Supply Chain?

To keep up with their customers in today’s marketplace, retailers need supply chain visibility to look closer at their entire supply chains’ performance in order to be successful. To have happy customers in today’s marketplace requires retailers to be much more responsive to their customer’s demands.

Retailers need to look end to end at their supply chain for the issues that drive their business. Having the right inventory strategy is just the start, you need to be customer centric in your execution: monitoring promotions and events and reacting to their preferences that drive business. Having the right tools in place gives you the ability to measure results and to balance the tradeoffs between: inventory, forecast accuracy, customer service, revenue, and profits.
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3 Key Intermittent Demand Mistakes to Fix and Master Your Inventory

Finding the Right Balance between Too Much and Too Little

Intermittent demand is far too often a stumbling block for inexperienced inventory managers. A few common mismanagement mistakes lead to deep cuts in a retailer’s GMROI.
Generally paired on the shelf alongside high-demand products, intermittent and low-demand products account for 35%-40% of retailer assortments, and can account for 35% of a retailer’s profits. Therefore, effective supply management of intermittent demand and low-demand products, especially in today’s cutthroat retail markets, is no longer a just question of competitive advantage, but rather one of survival.

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How A New Inventory Replenishment Discovery Made A Plain Retailer Grow

Inventory Replenishment Software Needs Updates

The retail landscape has changed widely over the last 15 years; How about your inventory replenishment? Today’s customers demand more choices and have higher expectations.. Customers want personalization; such things as on-demand product information, access to best price deals, express shipments and exceptional customer service as part of their experience. For companies to be successful in the marketplace, they must adapt the way they do business to accommodate today’s customer demands. To find success in the marketplace; they need to focus on their customer and become demand driven. The problem for many of you is your technology is as old as the phone in this picture and you stubbornly believe it doesn’t matter… bet the same folks who say it doesn’t matter have a $200+ smart phone in their pocket now…
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Avoid These Time-Bombs In Forecasting and Replenishment

Forecasting and Replenishment: a Time-Bomb Awaits.

Customer preferences have been changing; customers want personalization, on-demand product information like price deals, and exceptional customer service like 2 day delivery.  For companies to be successful in this marketplace, they must adapt the way they do business to accommodate such changes.  One aspect of a business, which directly relates to accommodating such change is forecasting and inventory replenishment. The real story is how market expectations have moved far beyond legacy inventory replenishment systems.
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Slow Demand Inventory Mistakes Even Smart People Make

Is Managing Slow Demand this Painful for You?

Slow and Intermittent traffic is bad, worse is a snowstorm shutting down the highway leaving you stranded in your car for 10 hours. There is nothing worse than slow or dead stopped traffic in a snowstorm right? Maybe, while we sit in traffic, we should consider the slow demand products in your assortment. Do your slow demand products need to be in your assortment? In reality, that’s the wrong question to ask, over 35% of your assortment has slow demand patterns. If you factor in the intermittent demand products, you are now reviewing over 60% of your products, a significant part of your inventory assortment and image to the customer.
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Demand Forecasting: The Ultimate Secret for Your Organization’s Success

“I am like any other man. All I do is supply a demand.” – Al Capone

Al Capone understood very well that the secret to making money was simply giving people what they want. That’s it.  Demand Forecasting is all about that one simple thing – figuring out what your customers want so that you will have product in place to fulfill their demands: the right products in the right place at the right time.
For Capone, this was a task made easy by Prohibition, which eliminated an end to end supply chain: the legitimate producers, wholesale distributors, and retail sellers of alcohol. They all went away and created a large scarcity of product. There was a serious supply void for the end consumer’s demand, one that Capone’s organization was more than happy to fill.
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Demand Driven Do's and Don’ts: 3 Keys to Retail Success

Demand Driven Supply Chain Don’ts

Demand Driven retail/ wholesale companies stay ahead of the competition by focusing on three key areas in their supply chain. In addition, demand driven retailers and wholesalers know you will resist change and stay focused on sales and gross margin, failing to allow GMROI to impact operating decisions. Demand driven retail / wholesale companies understand you and the competition stay focused on fast profits, growing sales and increased customer counts without reviewing the cost of acquiring those customers or learning why existing customers didn’t spend more due to out of stocks resulting from lost sales. Demand Driven retail / wholesale companies know the things to avoid by watching the competition’s mistakes. Resisting change and staying focused on old business concepts and numbers doesn’t work in the marketplace anymore.
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Omni-Channel Profits That Lie Hidden In Your Supply Chain

Your Business will Not See Profits from Omni-Channel this Year

The giants of retail took a huge bite out of 2013 sales. What did Apple, Walmart, Amazon, Macy’s, and Target get right? Omni-channel retailing…. they did it big and did it well to far surpass other retailers last year. Omni-channel retailing is the new multi-channel retailing that concentrates on a seamless customer experience through all available shopping channels, be it mobile device, brick and mortar, computer, tv, etc.
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