Monday, October 14, 2013

Aerospace OEM slow moving inventory solution case study

Challenge:  A major aerospace OEM has the requirement under contract to maintain spare parts availability for years after the initial sale of the product.  Maintaining this essential, but slow moving inventory has proven to be costly in the terms of inventory carrying cost.  Typically inventory carrying cost ranges from 20 to 35% of the inventory value per year. The slow moving inventory consumed millions of dollars of operating profits and thousands of warehouse locations. This prevented them from effectively growing the business for new product or improving existing customer service without making a major investment in facilities and increasing employee cost.
Solution:  GPS Inventory Solutions Inc. introduced them to the GPS INVENTORY BANK PROGRAMS. When they deposited their slow moving unpredictable demand inventory into the INVENTORY BANK, they were able to continue to provide long term customer service without the inventory carrying cost and they created about 18000 available locations. This provided the finances and space for growth they were seeking.
Results:  Their long term customer service was not interrupted and sales from the INVENTORY BANK actually provided a profit. They saved over four million dollars per year in inventory carrying costs. They freed up locations (18000) for faster moving inventory. Warehouse efficiencies improved as well as did inventory turns and gross profits. These benefits were recognized immediately after depositing the inventory into the GPS INVENTORY BANK.
About the solution provider: GPS Inventory Solutions Inc. (GPS) has been providing these benefits for companies in various industries for over thirty years.  They offer two INVENTORY BANK PROGRAMS. The STANDARD program is used by companies who want to write off the inventory without sacrificing customer service. The CUSTOMIZED INVENTORY BANK PROGRAM is used by companies who do not want to write off the inventory, but want to greatly reduce the carrying cost and gain all of the benefits of the STANDARD INVENTORY BANK.
Email: Inventory Management Programs
Phone 1 800 896 0477