SAHCO successfully reaches the balance between low warehouse stocks and high service level with the help of INFORM´s add*ONE
SAHCO, a renowned textile house from Nuremberg, manages over 4,000 exclusive fabrics, carpets and wallpapers with add*ONE from INFORM. The inventory optimization software creates precise forecasts for future demand development and provides automatic order proposals overnight. In addition, the add-on-system indicates critical stock situations. This has enabled SAHCO to reduce their warehouse stock by 18% and improve their delivery capacity for items with a high turnover rate. Through the enhanced transparency of the items’ availability, the purchasing department can swiftly react to changes and reorder in a timely manner.
“Inventory management is a delicate balancing act. Short delivery times require a broad spectrum of stored goods which can result in an increase of tied capital and warehouse costs”, explains Ludger Schuh, head of the Inventory & Supply Chain division at INFORM. These were exactly the challenges that SAHCO faced. More than 4,000 different items must be permanently available in the warehouse in Nuremberg and they need to be planned. There are 400,000 meters of materials which SAHCO exclusively designs and displays in its showrooms in New York, London, Paris and many more cities worldwide. The classy fabrics, such as silk and linen, reach customers through architects and interior designers.
“In order to meet the deadlines, our employees must keep track of our worldwide distribution structure at all times, since a bulk order in Dubai can quickly result in a shortage in our warehouse in Nuremberg. This is especially the case when long delivery times from specialized medium-size producers are involved – which are often manufacturers, like family businesses, with delivery times of 12 weeks or more”, explains Nicholas Müller, head of purchasing at SAHCO. Hence, the materials management, which can forecast future customer orders and that at the same time keeps the stock levels as low as possible, is crucial to prevent capital from being unnecessarily tied up while simultaneously meeting customer demand. For these reasons, SAHCO searched for a software tool, which could meet all of their requirements.
Increased availability, lowered stock levels
INFORM’s add*ONE add-on software was introduced in March 2014. It supplements the ERP system of SAHCO and uses field-tested forecasting methods based on mathematic algorithms. The necessary data from all countries where SAHCO is active enter the system over night and are used to calculate a forecast. These calculations are then used for cost-oriented optimization of order quantities. Transparency of the stock situation is achieved through the graphic representation of the development in demand and stock progression.
According to Nicholas Müller, the implementation of add*ONE led to the following results: “We were able to reduce our inventory levels by 18%, since we now only order what we actually need. We have also improved our already stable item availability for excitement creating items with a high turnover rate.” Quite remarkably, these results were achieved after just one year of add*ONE’s implementation.
According to Ludger Schuh, INFORM is also satisfied with the successful progression of the project. He states, “We are very glad for our new renowned customer, SAHCO, for whom a sustainable decrease in stock levels was facilitated through our software, without negatively impacting the availability of their goods.”
For more detailed user reports and other information please contact us via: inform(at)maisberger.com