Trane Air Conditioning Materials Inventory Control Strategy

Manufacturing enterprises of air conditioner have faced more and more competing pressure since 2006, and their margins have decreased largely which attributed to the following two reasons, one was price of raw materials and labor rose continually, the other was that price promotion policy was widely taken in this industry which made increased cost can not be transferred to consumer. Due to this situation, many companies began to invest much in research and innovation for getting advantages in fierce market, and made some operational improvement for cut their operation cost. Inventory, as a support to keep production run well, brings management cost to company, and to some extent, its management level can bring influence to company's failure. Therefore, inventory management and control must be strengthened, and manufacturing enterprise should do some researches and seek a right strategy of inventory control for themselves.Teling air conditioner system (Jiangsu) company, founded in 1995, and provided family air conditioner, central system air conditioner for Chinese market, faced inventory management difficulties also. In this article, we will combine inventory management theory with current situation of Teling air-conditioner system company, and find a right strategy of inventory control for Teling air-conditioner system company. First, inventory control theory or related will be introduced. And then we will analyze the inventory management problems of Teling air-conditioner system company. Finally we will give two solutions for Teling air-conditioner system company, one is internal optimization, and the other is implementation of VMI, sharing information with suppliers and reducing its material inventory. In this article, we will provide a right improvement strategy for Teling air-conditioner system company through its inventory management and control research, and make their inventory decreased and competitiveness improved, and it also will bring some steering for similar company in this industry.