Prerequisites for implementation of ABM Inventory
AgroHub faced inventory management challenges during a period of active scaling.
Major problems included inaccurate orders due to a decentralised and manual ordering process, resulting in periodic surpluses in certain categories, leading to waste and financial loss.
There was an issue of understocking other categories and SKUs, resulting in out of stock (OOS) and lost sales.
Project Goals:
Course of the project
AgroHub looked at several inventory optimisation solution providers and most of them were not compliant. Some didn't have smart algorithms for auto-ordering and didn't solve the problem for buyers. Some solutions consisted of several disparate modules, leading to the realisation that these were unlikely to simplify already complex production and sales processes due to the growing number of checkout points.
Customised solutions proved to be prohibitively expensive and too functionally complex to implement, while AgroHub was looking for the right balance between the cost of the solution and the clarity and speed of its implementation into the business. During the search, the company's management sought advice from several of its partners in Georgia who were already using ABM Inventory.
The first shop, which was launched as a pilot, was scaled up to the entire network after positive results.
Analysing the current situation
Assessment of the existing inventory management system, identification of major problems and bottlenecks.
Choice of solution
AgroHub considered several inventory optimisation solution providers and chose ABM Inventory due to its functionality, ease of implementation and competitive pricing.
System implementation
Automation of ordering process, integration with existing ERP system, setting up auto-order algorithms based on sales dynamics.
Staff training
Training employees to use the new system to improve efficiency and minimise errors.
Monitoring and adjustment
Continuous monitoring of system operation, adjusting settings to achieve optimal results.
Effects of the system implementation
Qualitative changes
-
Reducing losses due to spoilage and damage to goods.
-
Reduced warehouse utilisation and fixed costs.
-
Improved order planning and sales tracking accuracy.
-
Increased availability of popular products, especially during periods of high demand.
-
Improved communication between production, sales and warehouses.