Study On Replenishment Process And Channel Inventory Optimazation For A Secruity Company

With the increasing fierce competition, i.e. the customer's more demanding requirement on lead time reduction, channel performance excellence has becoming manufacturers'competition focus. To set up a good channel inventory management model will benefit to both manufacturers and their resellers.Based on current situation of organizational defects and unaligned department metrics, it is vital to set up a cross functional team– SIOP, focusing on demand & inventory planning optimization. After analyzing current demand forecast and replenishment plan process, it is studied the root cause of low forecast accuracy and submits optimized replenishment process for implementation. It also studied the root cause for high channel inventory and also frequent goods shortage by using fish bone chart. By incorporating supply chain management concept to its channel management, company A is about to set up Joint Management Inventory with its resellers and also establish horizontal replenishment process within same resellers group.After implementation, the on time delivery rate for end users'orders is improved and ITO for whole channel is increased and accordingly total channel inventory cost is reduced.This study is helpful to improve the demand forecast accuracy, reduce inventory of company A. Besides, channel inventory level is also reduced, and thus the relationship between company A and its resellers is better than ever, while the satisfaction level of end-user is improved. The practice provides a good reference for channel sales operation management of security company.