• Advertise
  • Contact Us
  • About Us
  • Supplier Directory
  • SCB YouTube
  • Login
  • Subscribe
  • Logout
  • My Profile
  • LOGISTICS
    • Air Cargo
    • All Logistics
    • Express/Small Shipments
    • Facility Location Planning
    • Freight Forwarding/Customs Brokerage
    • Global Gateways
    • Global Logistics
    • Last Mile Delivery
    • Logistics Outsourcing
    • LTL/Truckload Services
    • Ocean Transportation
    • Rail & Intermodal
    • Reverse Logistics
    • Service Parts Management
    • Transportation & Distribution
  • TECHNOLOGY
    • All Technology
    • Artificial Intelligence
    • Cloud & On-Demand Systems
    • Data Management (Big Data/IoT/Blockchain)
    • ERP & Enterprise Systems
    • Forecasting & Demand Planning
    • Global Trade Management
    • Inventory Planning/ Optimization
    • Product Lifecycle Management
    • Sales & Operations Planning
    • SC Finance & Revenue Management
    • SC Planning & Optimization
    • Sourcing/Procurement/SRM
    • Supply Chain Visibility
    • Transportation Management
  • GENERAL SCM
    • Business Strategy Alignment
    • Education & Professional Development
    • Global Supply Chain Management
    • Global Trade & Economics
    • HR & Labor Management
    • Quality & Metrics
    • Regulation & Compliance
    • SC Security & Risk Mgmt
    • Supply Chains in Crisis
    • Sustainability & Corporate Social Responsibility
  • WAREHOUSING
    • All Warehouse Services
    • Conveyors & Sortation
    • Lift Trucks & AGVs
    • Order Fulfillment
    • Packaging
    • RFID, Barcode, Mobility & Voice
    • Robotics
    • Warehouse Management Systems
  • INDUSTRIES
    • Aerospace & Defense
    • Apparel
    • Automotive
    • Chemicals & Energy
    • Consumer Packaged Goods
    • E-Commerce/Omni-Channel
    • Food & Beverage
    • Healthcare
    • High-Tech/Electronics
    • Industrial Manufacturing
    • Pharmaceutical/Biotech
    • Retail
  • THINK TANK
  • WEBINARS
    • On-Demand Webinars
    • Upcoming Webinars
    • Webinar Library
  • PODCASTS
  • VIDEOS
  • WHITEPAPERS
Home » Whose Inventory Is It Anyway?

Whose Inventory Is It Anyway?

March 7, 2013
SupplyChainBrain

There have always been potential and actual conflicts between the demand that a specific inventory was planned to serve versus other demands when they actually occur. These include:

"¢ Replenishing out-of-stock stores from distribution centers versus serving all stores at least to a minimal extent

"¢ Shipping to infrequent customers versus holding product for expected orders from more consistent customers

"¢ Selling spare parts versus holding them for assembly into finished goods

"¢ Shipping e-commerce orders from store inventory versus holding store inventory awaiting retail customer sales

Now there are increasingly more competing customer demands on each inventory.

All inventory is "owned" by the enterprise, regardless of the organizational structure. To maximize competitiveness, as well as financial and customer service performance, it should be considered equally available for sale to any customer when needed except insofar as:

"¢ Cost

Sunk costs incurred for delivery of the product to and storage in its current location

Costs that would be incurred for delivery to the needed location

"¢ Time

The time required for delivery to the needed location

The time required for replenishment

"¢ Contractual obligations with customers to establish segregated inventory

Transfer demand and demand for internal consumption, of necessity, must carry lower priorities. The solution is not mere protectionist-driven allocation, which reduces financial and customer service performance. Rather, the solution is a combination of:

"¢ Decision-making rules for potential situations and circumstances developed collaboratively ahead of time based on corporate objectives and customers, or at least market channels, taking into account: demand forecasts, on-hand balances and safety stock levels, replenishment lead times, sunk distribution center and inbound transportation costs, outbound distribution and transportation costs, and required customer response times.

"¢ Increased forecast frequency

"¢ Agile operational flexibility 

"¢ Communications with customers, where possible, regarding expected demand profiles versus gross period totals

Solid forecasting, demand planning, inventory management and lead-time management processes are fundamental, but they will not address this issue in and of themselves. In order to develop consensus on effective rules or guidelines each of these areas must be thoroughly understood, as well as the demand and supply dynamics for each inventory.

The Outlook

The most competitive companies have collaboratively developed, multifaceted decision-making processes that are worked out ahead of time and can automatically and quickly respond to competing demands in concert with management objectives. As firms gain experience with order management issues, more maturity will come to the nuances of the availability and cost and time factors, allowing decision-making to become more subtle and powerful.


Keywords: inventory control, inventory management, inventory management IT, logistics IT solutions, inventory ownership, title to inventory, supply chain management

RELATED CONTENT

RELATED VIDEOS

Logistics Inventory Planning/ Optimization Global Supply Chain Management Regulation & Compliance Supply Chain Security & Risk Mgmt
KEYWORDS Global Supply Chain Management inventory control Inventory Management inventory management IT inventory ownership Inventory Planning/ Optimization Logistics logistics IT solutions Regulation & Compliance SC Security & Risk Mgmt Supply Chain Analysis & Consulting Supply Chain Management title to inventory
  • Related Articles

    Just How Much Inventory Is Out There, Anyway?

    Inventory Is an Asset. Unless It's a Liability. Or Could It Be a Little of Each?

    Collaborative Purchasing Is an Idea Whose Time Is Now

SupplyChainBrain

Truck Freight Volumes Continued Decline in Fourth Quarter — U.S. Bank

More from this author

Subscribe to our Daily Newsletter!

Timely, incisive articles delivered directly to your inbox.

Popular Stories

  • DOCUMENTS BEARING THE INSIGNIA OF US CUSTOMS AND BORDER PROTECTION LIE ON A TABLE

    New CBP Regs Call for Greater Diligence by Brokers in Reporting Security Breaches

    Freight Forwarding/Customs Brokerage
  • A WORKER IN A WAREHOUSE, SUPERIMPOSED WITH GRAPHICS SHOWING SUPPLY NETWORK

    Enabling Intelligent Visibility With Supply Chain Analytics

    Data Management (Big Data/IoT/Blockchain)
  • The blank stare of a child's eye who is standing behind what appears to be a wooden frame

    The Alarming Continued Rise of Modern Slavery in Supply Chains: How Procurement Can Help Reverse the Trend

    Sourcing/Procurement/SRM
  • A GROUP OF WORKERS RANGED IN AN OFFICE, OF DIVERSE RACE, GENDER, AGE AND PHYSICAL ABILITY

    Podcast | The Supply Chain Workforce of the Future Is Already Here

    HR & Labor Management
  • A YELLOW AND BLACK TRAFFIC SIGN THAT READS "VOLATILITY AHEAD"

    Four Strategies for Addressing Supply Chain Disruption

    Sourcing/Procurement/SRM

Digital Edition

Scb nov 2022 sm

2022 Supply Chain Innovator of the Year

VIEW THE LATEST ISSUE

Case Studies

  • New Revenue for Cloud-Based TMS that Embeds Orderful’s Modern EDI Platform

  • Convenience Store Client Maximizes Profit and Improves Customer Service

  • A Digitally Native Footwear Brand Finds Rapid Fulfillment

  • Expanding Apparel Brand Scales Seamlessly with E-Commerce Technology

  • How a Global LSP Scaled its Security Program and Won More Business

Visit Our Sponsors

Orderful Yang Ming Alithya
Barcoding Blue Yonder BNSF Logistics
CoEnterprise Data Capture Deposco
E2open GAINSystems Generix
Geodis GEP GreyOrange
Here Honeywell Intelligrated IFM
Infor Inmar Keelvar
Kinaxis Korber Lean Solutions Group 2H
Liberty SBF Locus Robotics Logility
LogistiVIEW Lucas Systems MCA Connect
MPO Nvidia Old Dominion
OpenText ORTEC Overhaul
Parsyl PMMI QIMA
Redwood Logistics Ryder E-commerce by Whiplash Saddle Creek Logistics
Schneider Dedicated Setlog Holding AG Ship4WD
Shipwell Tecsys TGW Systems
Thomson Reuters Tive Trailer Bridge
Vecna Robotics Verity
Verusen
  • More From SCB
    • Featured Content
    • Video Library
    • Think Tank Blog
    • SupplyChainBrain Podcast
    • Whitepapers
    • On-Demand Webinars
    • Upcoming Webinars
  • Digital Offerings
    • Digital Issue
    • Subscribe
    • Manage Your Subscription
    • Newsletters
  • Resources
    • Events Calendar
    • SCB's Great Supply Chain Partners
    • Supplier Directory
    • Case Study Showcase
    • Supply Chain Innovation Awards
    • 100 Great Partners Form
  • SCB Corporate
    • Advertise on SCB.COM
    • About Us
    • Privacy Policy
    • Contact Us
    • Data Sharing Opt-Out

All content copyright ©2023 Keller International Publishing Corp All rights reserved. No reproduction, transmission or display is permitted without the written permissions of Keller International Publishing Corp

Design, CMS, Hosting & Web Development :: ePublishing