Benchmarks & Client Cases

Portfolio Optimization

The Challenge

Final Products References

Final Products References

Problem


• High dispersion of sales

• 11% of products account for 80% of sales

• Too many options to set up the product: 246 model types x 196 finishing options

Root Causes


• Lack of knowledge of product range amongst sales team members

• Long Lead Time for product development (with similar choices available)

• Low hit rate

• High levels of raw material stock

The Solution

mission-control-room-innovation-process

• Variety Reduction Program: rationalization of the product range

• Raw materials references review

• Negotiation with suppliers improvement

• New Costing and Budgeting Method

• Definition of new standards for replenishment and sales guidebook

• Awareness of different markets and projects margin

The Results

The project resulted in annual savings of $1.25 million and release $1.5 million of Free Cash-Flow in the first year.



product-margin-benefits

Margin for A-Products

raw-material-transformation-benefits

Hit rate

stock-value-benefits

Stock (Value k$)



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