Strategic inventory management: A catalyst for sales growth and profitability
In the dynamic landscape of perishables distribution, inventory management is a critical driver of business performance. As a former leader in charge of distribution operations for a premium protein producer, I witnessed firsthand how strategic inventory practices can significantly impact sales, margins, and overall market positioning.
Despite employing a Warehouse Management System (WMS), our organization grappled with inventory inaccuracies due to ineffective system processes, leading to operator frustration and poor adoption. These discrepancies resulted in order fulfillment issues, missed sales opportunities, and the need for discounting aging products—ultimately eroding our premium market position.
Previous attempts to address this issue through labor-intensive physical inventories proved both costly and ineffective, failing to address the root cause: Suboptimal system processes and user adoption.
Strategic solution: We implemented a three-pronged approach to revitalize our inventory management.
- System optimization: Modifying the WMS to enhance user experience with industry-specific functionality, particularly for operators in challenging environments like cold storage
- Advanced inventory control: Deploying real-time cycle counting and auditing features for immediate inventory corrections
- Stakeholder engagement: Investing in comprehensive training and coaching for operators and sales teams, fostering system trust and adoption
Measurable outcomes: This strategic initiative yielded substantial benefits.
- Sales performance enhancement: Improved inventory accuracy bolstered sales team confidence, leading to increased order reliability and volume capacity
- Margin improvement: Timely product turnover reduced discounting, shifting our market perception away from a discount-oriented retailer
- Operational excellence: Streamlined order fulfillment, improved efficiency metrics, and optimized daily operations planning
In the perishables sector, where product value rapidly depreciates, effective inventory management is not merely an operational concern—it is a strategic imperative that directly impacts top-line growth and bottom-line profitability.
At the time, our legacy system lacked the agility of a modern, cloud-based, multi-tenant warehouse management solution. Optimization efforts were constrained by reliance on a niche vendor for development support. System mastery required hands-on experimentation, while operator training necessitated in-house content creation.
The landscape has since evolved. Infor® now offers real-time inventory visibility and planning capabilities with its industry-specific software, positioning us to leverage cutting-edge technology for competitive advantage.
Inventory management: Real-time visibility
Infor Warehouse Management System (WMS) provides real-time visibility into inventory levels across multiple locations. Coupled with demand forecasting capabilities, this solution enables businesses to optimize stock levels, reduce costs, and enhance customer satisfaction through data-driven decision-making.
Infor CloudSuite Distribution Enterprise: ERPs built for distributors
Built on the experience of thousands of customers across industries, Infor's cloud-based distribution software empowers businesses of all sizes. This industry-specific solution equips them with the tools to streamline operations, adapt to evolving market dynamics, and effectively manage supply chain risk. Its robust capabilities span order entry, pricing, supply chain management, and global localization.
This experience underscores the necessity for distribution leaders to critically evaluate their inventory strategies and supporting technology. Organizations can unlock significant value, enhance market positioning, and drive sustainable growth by aligning industry-specific inventory best practices with broader business objectives.
Por Jeff Botsch | Industry Field Executive–Distribution
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