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Dynamic Inventory Optimization

Problem

Excess inventory steals capital and inadequate inventory robs revenue and impacts customer satisfaction, and, in industries like pharmaceutical, shortages may lead to loss of life

Cost

Excess and/or obsolete inventory can be large. For example, one mid-sized distributor of wine and spirits routinely runs $50 million of excess inventory thus prohibiting deployment of this precious capital that could be spent on marketing, capital investment, or more productive/profitable products.

Our Solutions

Replace static min/max inventory levels with dynamic and probabilistic statistical forecasts over a 12 month horizon to vary min/max for each product (and/or part) along with a three sigma (or more) range of outcomes to plan for and to understand the capital cost of higher or lower service levels.

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