Forecasts and truth. Your business depends on plans developed from forecasts; these inform logisticians of the future. Unfortunately, there are probabilities, uncertainties and associated risks, so the forecasts will be wrong; but they ensure your business is less wrong than if you did nothing. As an example, in my Newsletter for June 2013 (go to www.learnaboutlogistics.com to subscribe), I discussed forecasts … Read More
Outsourcing justification undergoes a change
What is happening? The business media has recently noted changes to the outsourcing approach in two industries. The mining industry in Australia is changing its business model so that operations in the mines are undertaken by mine companies employees, rather than mining services companies. In the global courier, express parcel (CEP) industry, the major companies have been enlarging their fleet … Read More
Inventory losses are big money
A repeat performance. When things go wrong with your inventory, there can be some big numbers and, at the very least, it will be supply chain, logistics and inventory managers who are looking for new jobs! Six weeks ago I discussed the likely ‘ripple’ effect from a retailer ‘discovering’ about $100m of excess inventory. This week there is another story. … Read More
Know your service parts
Criticality and risk of a service part. Managing your inventory requires an understanding of its behaviour so that sufficient is on-hand to provide availability for customers. This series of blogs has looked at categorising finished goods SKUs using the Coefficient of Variation Management (CoVM) approach, developed by Tom Rafferty, so that effective management can be achieved. A similar approach can … Read More
What is inventory worth to your business?
Describe your inventory investment. ‘Better’ planning for your business starts with sales and operations plan (S&OP). However, for the plan to really make a difference, operations must be structured to enable response to demand in an acceptable time period. Responding to demand means providing availability of items. This requires either making or assembling the items as required, or delivering … Read More