"Your inventory holdings, for good or bad, are a symptom of how you conduct your business"

The goal of any product based organisation should be to reduce inventory levels whilst continuously striving to improve the service levels offered to their customers or users. Indeed, with the levels of uncertainty that we are seeing in the global economy, the need to optimally manage inventory levels has never been greater.

Too little of the right stock and you fail to make a sale or support the business functions. Too much money tied up in the wrong stock and you constrain the potential of your business.

Inventory optimisation can be a complex, and often expensive, business. But it need not be.

RubiKon applies a 2 stage approach to the effective and long term optimisation of a business's inventory holdings:

Stage 1:

Consider this statement, “The outcome that is achieved from any process is a direct result of the constraints, policies, procedures, measures and reporting that manage, or effect, that process”.   The installation of inventory optimisation software will rarely solve your inventory problems if you have not first critically understood the constraints, and reviewed and corrected the policies, procedures, measures and reporting that drive those inventory levels.   Once the drivers of your inventory levels are identified and corrected then the implementation of powerful inventory optimisation software can help your business maintain the critical balance between inventory holdings and customer service levels.

Stage 2:

Implementation of the Red Cube Inventory Optimisation tool.  Red Cube is an innovative and proven software tool which employs the Single-Item Cost Weighted Back Order (CWBO) calculation technique to deliver guaranteed inventory cost and effectiveness improvements for commodities close to an optimum system-based method but with substantially less data, and easier implementation.  Red Cube CWBO methods have been demonstrated to produce a near-optimal solution using only Demand, Lead Time and Price data. Red Cube can exceed the existing performance of out-dated Demand Satisfaction methods for up to 85% less inventory investment. On average, 90%+ levels of performance can be achieved for 30% less inventory investment. Implementing Red Cube is guaranteed to reduce inventory investment, unsatisfied demands and/or both.

For more information about RubiKon's inventory optimisation services and the Red Cube Inventory Optimisation tool, contact one of our regional business managers here.