Benchmarks & Client Cases
Bought-in Part Planning
• Average stock coverage of 67 days, with average supplier Lead Time of 31 days
• $18.1m worth of inventory held in stock due to inconsistent deliveries by the supplier
• 4000 pallets stored in the warehouse
• Lack of frequent KPI tracking: stock value, stock coverage or supplier Lead Time
• Component ordering based on forecasts with low accuracy
• No repercussions for suppliers who fail to comply with service level agreements
• Implementation of Periodic ABC Classification (frequency and volume) to identify material requirement planning and reorder point articles
• Reorder Point Pilot tool in Excel to validate the concept
• Renegotiation of supplier contracts: Lead Times, frequency of delivery, minimum order quantity, consignment and packaging
• Pull Planning Manual and Standardization of planning processes
• Standard reports to communicate with suppliers
The organisation was able to free more than $2.3 million in Cashflow.
Average Stock Coverage
Stock coverage reduced by 20%
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