Distributor reduces potential stockouts by $27M+
Leading industrials distributor reduces potential stockouts and identifies tens of millions of dollars of excess inventory with Ikigai's core Demand and Inventory Forecasting solution
Business challenge
Distribution Co.'s customers frequently place orders with insufficient lead time for Distribution Co.'s suppliers
Distribution Co’s suppliers often require a a lead time 12-24 months, but customers’ orders routinely require much faster timelines
As a result, Distribution Co. regularly experienced millions of dollars of overstocks and stockouts
Distribution Co. often overstocked inventory to avoid delays in fulfilling customer orders, which ate into profit margins; even with this excess inventory, Distribution Co. still often delivered goods months late to customers due to unanticipated stockouts
Distribution Co. needed better forecasts for their customers’ orders to avoid stockouts and reduce the need to carry excess inventory
Better forecasts would allow Distribution Co. to more accurately predict inventory needs, which would both reduce the chance that a customer would order something Distribution Co. was sold out of, as well as limit the need for Distribution Co. to intentionally stock inventory reserves that may not be needed
Before Ikigai, Distribution Co. had no forecasting solution to prevent stockouts
To guide their purchasing, Distribution Co. was stuck querying their inventory using a terminal-like, highly manual interface and working in spreadsheets
Ikigai’s solution
Core Demand & Inventory Forecasting solution:
- Forecasted demand at a granular level (split by individual product and geographical division) to create 2 years of advance visibility into expected orders
- Developed stockout alerts to proactively recommend what products to order, when to order those products, and to which facilities to send those products
- Integrated Ikigai's solution with Distribution Co.'s ERP to ensure data freshness
Key outcomes
Benefits of Ikigai
- Ikigai’s aiCast product enables accurate, long-range forecasting at the product and location level with 2 years of visibility and monthly updates
- Dynamic alerts based on orders, historical demand, forecasted demand, and current inventory empowers business to avoid stockouts
- User-friendly dashboard allows key stakeholders to quickly and easily understand state of inventory & anticipated demand
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