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Inventory optimization

November 07, 2018 540 Views

Description

PK OEM Parts is a supplier of high end OEM spare parts. They operate within a niche market, the shipping and power plant industry. Sales and distribution is done globally. PK OEM Parts operates from Dordrecht, The Netherlands, where they have located their headquarters and warehouse between the international ports of Rotterdam and Antwerp.

Opportunities

In a prior study done by Groenewout an opportunity was identified to reduce stock levels at PK OEM Parts while simultaneously improving service levels. The suggested ordering policies that came out of this earlier study had been implemented by PK OEM Parts with positive results. After considering a number of 3th party software suppliers to help facilitate this new ordering policy PK OEM Parts reached out to Groenewout to help develop and implement a custom inventory optimization tool.

Solution

Groenewout developed a user friendly stand alone tool in MS Access. This tool allows users to easily import data downloaded from the ERP system, after which parameters are calculated and outputted in a form that in turn can be uploaded back into the ERP system. Additionally, a number of adjustable settings are provided that allows users to control the desired service levels according to an ABC classification, as well as describe and define several internal processes at PK OEM Parts.

 

Benefits

  • Stock reduction of ~20%, while maintaining and in many cases improving service levels.
  • Unique insight into current stock levels, bringing forward a number of issues that at the time had gone unnoticed.
  • Relatively low one time development costs with no licensing fees.
  • Low implementation effort for PK OEM Parts. The tool was developed as a stand alone tool that requires no adjustments to the ERP system and little to no training by users.