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ZLU Consulting and Management
Inventory Optimization
Company specific inventory strategies are a pre-requisite for the optimization of inventory stocks and are thereby an exceedingly important partial aspect of working capital management. Irrespective of the question, which of the various stock levels is being employed in a distribution network, such as plant, central, regional or warehouse. There is always the question of the best inventory costs depending on delivery quantities and transport costs.
Apart from the stock issue, the identification and implementation of measures for the additional release of liquidity in the areas of debtors and creditors is an additional sphere of activity that rounds off a value adding working capital management.
Key Questions
- With what type of inventory distribution function would your company like to run its distribution network?
- How is your strategy of the system of inventory distribution shaped? Are the various cost aspects such as quantity and size of warehouses, handling costs, costs for transport between warehouses, delivery costs or inventory costs being accounted for?
- Are you employing a professional ABC-analysis to decide if, centralised or de-centralised stock of a, b, or c articles is sensible for specific order and delivery cycles?
- How do you manage diverging target conflicts with regard to criteria such as inventory reduction, order cycle or cycle time?
- What criteria do you use in order to decide on the amount of capital commitment?
- Do know how key figures, for example working capital, influence the financing options for your company? How are you influencing these key figures?
