Safety Stock Optimization
Challenges
When it comes to inventory planning, the key is to build out inventory to meet strict lead time and order fulfillment requirements, as any delay in delivery or stock out can result in significant losses to customers and violate the service level agreement (SLA).
Yet it is hard, in many industries when it comes to effective inventory planning:
- A large number of SKUs
- Different, and strict SLAs for different SKUs and customers.
- Difficulty in making accurate forecasts.
- Occasionally being custom-made for special purposes.
- Non-substitutable by other SKUs.
- Requiring a high level of coordination across different functional groups.
To prevent stockouts and SLA violations, companies often resort to overstocking, which can lead to significant waste of working capital.
Sophus Solution
Segment and classify products based on their product characteristics, such as product value, demand volatility, and ordering frequency.
Improve inventory turnover and reduce the working capital
Recommend when to stock, where to stock, and how much to stock, along with the optimal replenishment frequency.
Benefits
Order Fill Level Improvement
Inventory Reduction for as much as
20-25%
Request a demo