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HAVE INVENTORY IN THE WRONG PLACE?

Improve Your Inventory Position across Multiple Warehouse Locations

Does managing inventory across multiple warehouses give you “inventory anxiety?” Do you spend a lot of time worrying about whether you have enough stock where you need it? Are your warehouses often overstocked on some items, but understocked on others?

Managing your inventory across multiple warehouse locations doesn’t have to be a gut-wrenching experience.

Absolute Value Demand Planning defines SKU’s (Stock Keeping Units) as a particular item in a particular warehouse. The system helps you deploy your stock to the right warehouse with the right quantities, based on the SKU’s respective forecast and time-phased expected inventory.

 
 

Buy More Economically and Improve Customer Fill Rates in all Locations

The challenges involved in synchronizing all your incoming and outgoing inventory grows exponentially when there are multiple warehouse locations involved. The key is to use a system that allows you to see and manage inventory in each location and across all locations at the same time.

With the Absolute Value Demand Planning system buyers are presented with the availability of surplus quantities by warehouse, and can choose to transfer all, part, or none of the quantity to balance their inventory across the supply chain.

Each warehouse or location can function as a hub or a spoke by item. This allows factors such as proximity to customers, shipping costs, and best vendor values to all to be considered when determining a hub or spoke location for items. It also provides maximum flexibility to optimize your purchasing and best handle customer fill rates.

Hub & Spoke Replenishment:

A more accurate approach

Use Hub & Spoke so that you have the right inventory in the right place at the right time. All warehouses can be stocked on days’ supply.

Optimization of the hub and spoke concept is typically determined based on whether a specific warehouse can qualify as a hub by being able to place a purchase order for the vendor minimum at least once a month. Warehouses that can’t reach the vendor minimum once a month would typically be defined as spoke warehouses for that vendor’s products.

One spoke warehouse will often sell more than expected while others may sell less than expected. The goal is to move a smaller amount of inventory, based on a day’s supply, to a branch warehouses so that they don’t become overstocked.

The system’s inventory balancing suggestions can be used to periodically rebalance inventory as needed.

Those experienced in working with small or remote warehouses know they don’t necessarily have consistent usage. To achieve more consistency and accuracy, Absolute Value’s Demand Planning system takes a unique approach to hub & spoke replenishment. Rather than rolling up the forecast from the spoke locations, the system rolls the usage history up through the replenishment path for purchasing or manufacturing at the hub level.

The system creates a forecast at each level, but it relies on the forecast at the top for buying or manufacturing planning.

 

Why Hub & Spoke Replenishment?

  • Demand Planning rolls up historical usage to get a more accurate forecast at the hub where we buy
  • Any warehouse can operate as a hub or a spoke for any item
  • Suggested transfers move product from the hub to the spoke based on days’ supply needed at the spoke
  • Demand Planning’s goal is to move an inventory item once to a spoke

Manage Your Inventory Across Multiple Locations:

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