‘A business is as good as its inventory’ is a popular jargon that cannot be overlooked no matter how advanced business technologies can get. A sound Inventory Management and Inventory Analysis should ensure the right amount of supply of products made available at the right time and delivered to the right place at the right price. Given the dynamic model of demand and supply, it is utmost essential to get all the right efforts in sync to reap maximum benefits that result in cost optimization. Monitoring systems to keep track of the imbalances arising in the supply and demand cycles are dynamic and evolving.
Logistics is the process that creates value by timing and positioning inventory. Value is created only when customer satisfaction is achieved with lowest cost. Regardless of the size of the enterprise, inventory management is very critical. In simple terms, if inventory is not used efficiently, money can get locked and cash-flow can be affected. Logistical strategies should be designed to maintain the lowest possible financial investment in inventory. The basic goal is to achieve maximum Inventory-Turn while satisfying service commitments.
The Concept of Importance and Exception (CIE) is widely used to monitor complex business systems, the most powerful and common classification tool by categorizing the products based various factors including, unit value, total value of sales/revenue, order frequencies, demand patterns, unit weight, availability etc. CIE results in an Inventory Matrix through which Inventory Optimization can be achieved. Supply & Demand analysis can be enhanced by extending the 2-Dimensional Matrix to Multi-Dimensional Inventory Analysis. With this powerful Smart4-D tool, users can study different inventory patterns to achieve Inventory and Cost Optimization.