Supply Chain/Distribution Management

What is supply chain/distribution management?

The success of a supply chain is dependent on each links ability to supply everything that is needed by the succeeding link, without choking the system on unnecessary inventory. The concept of "Replenishment" is an approach to supply chain management that moves away from forecasts and yet provides higher fill rates. It is based on the belief that variation in local demand is the constraining factor in a supply network. This approach to replenishing inventory uses the same data that would be used to drive a forecast, but only to set initial stocking levels. After those levels are set, only actual units sold are replenished. When seasonality is an issue, the replenishment formula is devised to handle the expected rise and fall in demand.

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What are the benefits of supply chain/distribution management?

The benefits of an approach to inventory management that moves away from forecasts include:

• Higher fill rates to customers
• Lower levels of inventory in a distribution system
• Higher reliability and lower levels of "raw material" inventories when the replenishment methods are used with external suppliers
• Higher reliability and lower levels of "work-in-process" inventories when the replenishment methods are used with internal suppliers

What can CIRAS do for my company?

From initial training through the calculation of initial stocking levels to the creation of a dynamic "buffer management" system, CIRAS can provide a productivity team expert to facilitate the entire replenishment implementation process.

What is my next step?