Executive Briefings

Effective Inventory Management in Bulk Distribution

It doesn't matter if the cost of supply is at an all-time high or fluctuating wildly, the impact of excess inventory and inefficient operations can be crippling to cash flow in bulk distribution.

Effective Inventory Management in Bulk Distribution

While it is obvious that inventory costs money, most companies are not aggressively seeking to exert control and carry fewer overall gallons. The same holds true for operational efficiency. There are transportation savings to be had from the company fleet or from outsourced carriers. These savings will flow directly to the bottom line, enhancing positive cash flow. In order to achieve the desired results we must provide the proper tools to operations and stop asking them to try and keep up with an increasingly complex operating environment.

Many companies have invested heavily in tank monitors and telemetry in order to track inventory levels for their customers. As an unanticipated consequence, these companies can actually become less efficient because they either can’t keep up with the information overload from so many data points, or they effectively become slaves to the low stock alarm. In either case, effectiveness suffers and costs rise. More than simple visibility is needed for effective inventory management.

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While it is obvious that inventory costs money, most companies are not aggressively seeking to exert control and carry fewer overall gallons. The same holds true for operational efficiency. There are transportation savings to be had from the company fleet or from outsourced carriers. These savings will flow directly to the bottom line, enhancing positive cash flow. In order to achieve the desired results we must provide the proper tools to operations and stop asking them to try and keep up with an increasingly complex operating environment.

Many companies have invested heavily in tank monitors and telemetry in order to track inventory levels for their customers. As an unanticipated consequence, these companies can actually become less efficient because they either can’t keep up with the information overload from so many data points, or they effectively become slaves to the low stock alarm. In either case, effectiveness suffers and costs rise. More than simple visibility is needed for effective inventory management.

Read Full Article

Effective Inventory Management in Bulk Distribution