• Advertise
  • Contact Us
  • About Us
  • Supplier Directory
  • SCB YouTube
  • Login
  • Subscribe
  • Logout
  • My Profile

  • CORONAVIRUS
  • 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
  • REGIONS
    • Asia Pacific
    • Canada
    • China
    • Europe
    • Latin America
    • Middle East/Africa
    • North America
  • THINK TANK
  • WEBINARS
    • On-Demand Webinars
    • Upcoming Webinars
  • PODCASTS
  • VIDEOS
  • WHITEPAPERS
Home » How Sweden's Procurator Got a Handle on Its Inventory

How Sweden's Procurator Got a Handle on Its Inventory

August 23, 2013
SupplyChainBrain

By today's mega-company standards, Procurator isn't especially large. But the Swedish provider of industrial safety products and janitorial supplies has a complex, multichannel supply chain.

With annual turnover of around $190m, Procurator is both a retailer and a wholesaler. It runs 17 stores plus wholesale cash-and-carry operations. And, like any company that wants to be successful today, it maintains an online presence for both sales channels.

In addition to its operations in Sweden, Procurator has business units in Denmark, Finland, Norway and Poland. Products include hardhats, glasses, shoes and clothing for personal protection in industries such as construction, as well as cleaning supplies and heavy equipment. The company has four distribution centers holding some 19,000 SKUs with highly variable order lead times. Sourcing ranges from Asia to local providers in Scandinavia.

A corporate merger in 2008 caused Procurator to reevaluate the way it was calculating inventory levels and customer demand. When the market tanked soon after, the company was left with large amounts of overstock from the acquisition, recalls purchasing director Anders Armandt.

Information technology was lagging as well. Procurator found itself trying to run a multichannel company with an old purchasing system, driven by its enterprise resource planning software. Forecasts were long in developing and inaccurate in practice. Proactive supply-chain planning had become an impossibility, Armandt says.

Meanwhile, Procurator was looking to consolidate inventory at fewer locations, closing some warehouses and moving stock to its main distribution center at the Malmo, Sweden headquarters. There was only one problem: "We didn't have a clue what was in them," says Armandt.

The ERP system proved inadequate to handle the job. The lack of visibility meant that Procurator's buyers often had to scramble for product at the last minute in order to hit service goals. Forecasts were sales-driven, based entirely on historical data. The result was excess inventory for multiple items, coupled with poor customer service.

The One-Stop System

Procurator's goal was to find one system that could efficiently handle both warehouse operations and purchasing, while giving it a better handle on product forecasts. It looked at three vendors of demand-forecasting, planning and replenishment software before settling on Marietta, Ga.-based Blue Ridge Inventory Group LLC.

Armandt was impressed by the flexibility of Blue Ridge's technology, based on the provider's years of experience in developing purchasing systems. Moreover, he says, Blue Ridge was able to come up to speed quickly. Procurator selected the vendor in June 2009, and implementation was underway by the following October. "We needed help fast," he says.

Procurator's data was in fairly good shape, says Blue Ridge chief executive officer Greg White. The problem was that its forecasting and replenishment processes were ineffective. Over-reliance on the company's ERP system for planning was resulting in too much manual intervention. "Human emotion takes over where judgment and science should be in play," White says.

Over a five-month period, data from around 450 suppliers was cleansed and inputted into the Blue Ridge system known as Clarity Replenish. Armandt says the benefits were already evident with onboarding of the first 10 to15 suppliers. At last, Procurator had at its fingertips precise details about what and how much had been purchased, along with order lead times and the service level for each item.

"I wanted the system fully updated," he says. "I didn't want anything in my purchaser's head."

With the help of Blue Ridge, Procurator was able to segment demand by customer, channel, location and item. In the process, it gained a more accurate picture of demand. "Most importantly," says Armandt, "we could better understand the "˜why' behind customer demand that a stochastic forecast could never show."

Few companies with the complexity of Procurator are able to generate one forecast to cover all their needs. But Blue Ridge's system can aggregate data from multiple forecasts to generate a single demand number. The combined result is subject to less variability, the company says.

Handling Multiple Channels

For the first time, Armandt was able to create a single purchase order to replenish multiple channels. "Additionally," he says, "we no longer had to separate files of inventory for different channels, or the customers with whom we had a contract to supply a certain level of inventory. We could also carry out distribution from a central location, further enhancing logistical efficiency."

As a result, Armandt could provide suppliers with purchasing forecasts months in advance, enabling the partners to work on cutting order lead times.

With one system handling multiple processes, Procurator could start to address the imbalance between sales and purchasing. Today, says Armandt, the latter has "significantly more influence within the company."

Even so, Procurator faced a human-relations challenge when it moved to split product managers and purchasers into two departments. Fearing that their jobs were in jeopardy, some employees were reluctant to use the new application, even to the point of reverting back to the old system. Eventually, says Armandt, they came to understand that the new method of working saved time, freeing them up to focus on more accurate forecasting and lead-time calculation.

Hard benefits derived from the initiative were another strong selling point. In the first eight months of working with Blue Ridge, Procurator boosted its in-stock performance levels from 89 percent to 94 percent. At the same time, it reduced inventory levels from around $19.4m to $15.2m.

Subsequently, Procurator has further improved service to 97 percent, slashed inventory by 25 percent and increased turns from 2.9 to 6.5.

The company's success prompted Armandt at the beginning of 2012 to make a bold commitment to top management: by year's end, he would cut inventory by another $1.25m. When the target date arrived, he had actually achieved a further reduction of $2m.

With the Blue Ridge system fully up and running, Armandt is next planning to shift Procurator's use of the Blue Ridge application to a hosted, software-as-a-service (SaaS) model. The change, he says, will allow for "more power in the system, and faster calculation for analyzing." In addition, Procurator plans to expand its use of Clarity from the Malmo warehouse to additional locations, including the retail stores, so that it can shift overstock to wherever it's needed.

The system gave Procurator the ability to address "organizational pitfalls," says Armandt. "We are now a proactive, lean and efficient purchasing machine."

Resource Links:
Procurator
Blue Ridge Inventory Group


Keywords: supply chain, supply chain management, inventory management, inventory control, global logistics, logistics management, warehouse management systems, WMS, logistics services, supply chain planning, sourcing solutions

RELATED CONTENT

RELATED VIDEOS

Logistics Global Logistics Service Parts Management Transportation & Distribution Sales & Operations Planning Forecasting & Demand Planning Supply Chain Finance & Revenue Management Sourcing/Procurement/SRM Inventory Planning/ Optimization Supply Chain Planning & Optimization Supply Chain Visibility Technology All Warehouse Services Order Fulfillment Warehouse Management Systems Industrial Manufacturing
KEYWORDS All Warehouse Services Blue Ridge Inventory Group EDI Communication (XML/EDI) Forecasting & Demand Planning Global Logistics Industrial Manufacturing inventory control Inventory Management Inventory Planning/ Optimization Logistics logistics management logistics management: inventory planning and optimization logistics services order fulfillment Procurator Sales & Operations Planning SC Finance & Revenue Management SC Planning & Optimization Service Parts Management Sourcing Solutions Sourcing/Procurement/SCM supply chain Supply Chain Management Supply Chain Planning Supply Chain Visibility Technology Transportation & Distribution Warehouse Management Systems WMS
  • Related Articles

    How Sears Got a Handle on Its Reverse-Logistics Flow

    How a Paper Products Manufacturer Got Its Transportation Costs Under Control

  • Related Directories

    SnapFulfil

    Parsyl

SupplyChainBrain

NRF Supply Chain 360: A Preview

More from this author

Wake up to live
“Supply Chains in Crisis”
updates and the latest Supply Chain News!

Subscribe to our Daily Newsletter

Timely, incisive articles delivered directly to your inbox.

Popular Stories

  • Medical drone

    Amazon May Be Proof That Delivery Drones Aren’t Practical

    Last Mile Delivery
  • SEC building seal

    Get Ready for the Next Phase of ESG: Mandatory Corporate Due Diligence

    Regulation & Compliance
  • ESG Guide

    Confronting the ESG Imperative in Supply Chains

  • Heat Wave Triggers Blackouts

    Vast Swath of U.S. at Risk of Summer Blackouts, Regulator Warns

    Supply Chain Security & Risk Mgmt
  • Worker using tablet

    Podcast | Stitching Together the Physical and Digital Supply Chain

    Technology

Digital Edition

Scb may 2022 sm

2022 Supply Chain ESG Guide

VIEW THE LATEST ISSUE

Case Studies

  • 3PL Doubles Productivity With Robots to Fulfill Medical Supply Orders

  • E-Commerce Company Cuts Order Fulfillment Time by 40%

  • Fashion Retailer Halves Fulfillment Time With Omichannel Automation

  • Distributor Scales Business by Integrating Warehouse Automaton Software

  • Fast-Growing Fashion Brand Scales E-Commerce Fulfillment With Whiplash

Visit Our Sponsors

Yang Ming Alithya Barcoding
Blue Yonder BNSF Logistics Generix
GEP GIB USA GreyOrange
Here Honeywell Intelligrated Inmar
Keelvar Kinaxis Korber
Liberty SBF Locus Robotics Lucas Systems
Nvidia Old Dominion Parsyl
Redwood Logistics Saddle Creek Logistics Schneider Dedicated
Setlog Holding AG Ship4WD Shipwell
Tecsys TGW Systems Thomson Reuters
Tive Trailer Bridge Vecna Robotics
Whiplash    
  • 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 ©2022 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