Network Inventory Planning
Many companies have built up a relatively large, widespread global network of warehouses in order to quickly meet local demand. Planning inventory across the entire network, while at the same time taking the interrelations of the various warehouses into account, is no easy task. Transparency is therefore the key factor for the holistic optimization of inventory across a network.
Overview
The optimization of inventory at a single warehouse is subject to relatively manageable influencing factors in the local system. However, within a network, each node, or warehouse, must be taken into consideration. These individual network locations often have their own local system in place.
This issue, coupled with a lack of transparency, often leads to the following situation: a regional distribution center makes a stock decision without considering the inventory situation at the beginning of the supply chain, a factor that is actually quite relevant for the overall optimization of stock within the network. The same holds true for the downstream nodes in the supply chain. All too often, a central warehouse will make decisions based on overall demand history, rather than using the known demand from local warehouses. This lack of information is one of the main reasons for the Bullwhip-Effect.
Contact
Christoph Wiericks
Consultant
Tel: +49 (0) 2408 / 9456 - 1333 c.wiericks@informinform-software.com
Solution ADD*ONE Features
The ADD*ONE network inventory optimization tool integrates all the important data from individual warehouses in order to create a holistic optimization plan. The module is an optimal add-on to the add*ONE Inventory Optimizer and offers comprehensive functionalities for optimized network inventory planning:
- Display complex network structures
The item-related relationships of individual nodes enable a flexible representation of complex network structures.
- Independent determination and update of article-specific network levels
An item-related analysis of the network structure is carried out each day and constitutes a basis for the network level determination, which considers various item-plant combinations.
- Calculation of net demand for each network level
Demand coverage calculation (optimization) for an item at a site is only made when all requirements concerning this item are known. This is enabled by a daily, independent calculation and update of item-related network levels.
- Quick Network Navigation
The ADD*ONE user interface allows for a quick item-related navigation within the network, the representation of an item's overall situation for all nodes in the network as well as a high transparency of the network data.
- Cross-plant View
A cross-plant view enables the user to recognize the network nodes where stocks are available for a certain item. This way, the overall situation of an item can be assessed for all nodes in the network.
- Alert Function
In order to reduce inventory risks, ADD*ONE notifies the user with an alert function in the case of excessive stocks or deficits in storage in the overall network. Superfluous new orders are avoided by shifting goods within the network.
- Network planning in one planning run
Planning of the overall network occurs in one planning run; the necessity for several plant planning runs in succession and the problems concerning their sequence are thus avoided.
- Long-term preview of article demand within
Since network planning is carried out for the total planning period of multiple months, a long-term demand preview of all items in the network can be established.
Benefits
ADD*ONE network inventory planning offers users an efficient planning process in complex logistics networks through quick navigation, long-term forecasting, and comprehensive network optimization. Further benefits include:
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Increased transparency
Keep track of all items through complete transparency of the stock situation in the network
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Inventory optimization across the entire network
Reduce your inventory by up to 40%
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Reduced planning effort
Reduce planning effort by 25% to 50% through the automation of many planning decisions
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Improved availability to end-users
Obtain a near 100% delivery capability through high-quality planning
Success Story
Success with ADD*ONE Network planning at SFS
In order to ensure that production and customer requirements are met at the 14 European warehouse sites of Swiss company SFS Intec, all items must be available in the right quantity to be delivered on time.
Meanwhile, the balancing act between item availability, turnover and capital commitment has to be taken into account, as well as production consistency and the on-going processes of all warehouses. Using INFORM's ADD*ONE Inventory Optimizer together with the additional Network Planning module, these complex tasks have now been greatly simplified for the 60 members of the planning team
References
Contact
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