May 17, 2020

Why is inventory management in the supply chain important?

Supply Chain
Sean Galea-Pace
2 min
Supply Chain Digital explores why inventory management in supply chain is important.
Clear visibility into transactions that positively impacts the entire process of ordering, storing and using inventory is essential to companies' long-t...

Clear visibility into transactions that positively impacts the entire process of ordering, storing and using inventory is essential to companies' long-term growth.

A prominent inventory is considered a core component of the supply chain and is where all areas of the supply chain come together in tandem. Supply Chain Digital explores why inventory management in supply chain is the key to sustained success.

What is inventory management?

Inventory management is the products or materials a company sells to its customers in order to make profit. As part of the supply chain, inventory management includes several different aspects such as controlling and overseeing purchases from suppliers and customers, maintaining the storage of stock, controlling the amount of product for sale and order fulfillment. There are three core steps of inventory management:

  1. Purchasing inventory - raw materials or components are bought and delivered to the warehouse.

  2. Storing inventory - inventory is stored until needed. Raw materials are moved to production facilities to be made into finished goods and returned to stock areas until ready for shipment. 

  3. Profiting from inventory - the amount of product for sale is controlled. Finished goods are pulled to fulfill orders. Products are shipped to customers.

The banking giants, IBM, believes that inventory can be a company’s most important asset. The company has established five steps to begin a journey of inventory visibility.

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  1. Determine where the inventory exists across your network and systems that are tracking that inventory.
  2. Do you build or buy?
  3. Decide if you are going to update your entire order management system or start with getting an accurate real-time view of your inventory.
  4. Build a business case to justify the investment.
  5. Start assessing different vendors to observe which is the best fit for your needs.

Why is inventory management important?

Fulfillment is at the heart of the customer experience and gets to what really matters. It drives loyalty and ensures customers return to your business. In order to grow, it’s important to keep the promises you make and deliver orders efficiently. It’s vital that companies with complex supply chains and manufacturing processes strike the right balance of inventory size.

For more information on all topics for Procurement, Supply Chain & Logistics - please take a look at the latest edition of Supply Chain Digital magazine.

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Jun 21, 2021

Pandora and IBM digitise jewellery supply chain

supplychain
IBM
Pandora
omnichannel
2 min
Jewellery retailer Pandora teamed with IBM to streamline supply chains as sales of hand-finished jewellery doubled across ecommerce platforms

Pandora has overhauled its global supply chain in partnership with IBM amid an ecommerce sales boom for its hand-finished jewellery. 

The company found international success offering customisable charm bracelets and other personalised jewellery though its chain of bricks and mortar retail destinations. But in 2020, as the COVID-19 outbreak forced physical stores to close, Pandora strengthened its omnichannel operations and doubled online sales. 

A focus on customer experience included deploying IBM’s Sterling Order Management, increasing supply chain resiliency and safeguarding against disruption across the global value chain.

Pandora leverages IBM Sterling Order Management as the backbone it its omnichannel fulfilment, with Salesforce Commerce Cloud powering its ecommerce. Greater automation across its channels has boosted the jeweller’s sustainability credentials, IBM said, streamlining processes for more efficient delivery. It has also given in-store staff and virtual customer service representatives superior end-to-end visibility to better meet consumer needs. 

Jim Cruickshank, VP of Digital Development & Retail Technology, Pandora, said the digital transformation journey has brought “digital and store technology closer together and closer to the customer”, highlighting how important the customer journey remains, even during unprecedented disruption. 

"Our mission is about creating a personal experience and we've instituted massive platform changes with IBM Sterling and Salesforce to enable new digital-first capabilities that are much more individualised, localised and connected across channels and markets,” he added. 

 

Pandora’s pivot to digital 

The pandemic forced the doors closed at most of Pandora’s 2,700 retail locations. To remain competitive, it pivoted to online retail. Virtual queuing for stores and virtual product trials via augmented reality (AR) technology went someway to emulating the in-store experience and retail theatre that is the brand’s hallmark. Meanwhile digital investments in supply chain efficiency was central to delivering on consumer demand. 

“Consumer behaviour has significantly shifted and will continue to evolve with businesses needing to quickly adapt to new preferences and needs,” said Kareem Yusuf, General Manager, AI Applications and Blockchain, IBM. “To address this shift, leading retailers like Pandora rely on innovation to increase their business agility by enabling and scaling sustainable supply chain operations using AI and cloud.”

Yusuf said Pandora’s success was indicative of how to remain competitive by “finding new ways to create differentiated customer experiences that protect their enterprises from disruptions to help mitigate risk and accelerate growth”. 
 

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