inventory optimization Archives - Page 4 of 15

Smart Software to Present at Epicor Insights 2022

Smart Software President and CEO to present Epicor Insights 2022 Sessions on Creating Competitive Advantage with Smart Inventory Planning and Optimization

Belmont, MA, May, 2022 – Smart Software, Inc., provider of industry-leading demand forecasting, planning, and inventory optimization solutions, today announced that it will present at Epicor Insights 2022.

Greg Hartunian, CEO of Smart Software, will present two sessions and will explain Epicor Smart Inventory Planning and Optimization at this year’s Epicor Insights event in Nashville, TN. Greg will show how to empower planning teams to reduce inventory, improve service levels, and increase operational efficiency.

The Prophet 21 presentation is scheduled for Wed May 25th, 11:30 am -12:15 pm (CST)

The Kinetic presentation is scheduled for Wed May 25th, 2:30 pm – 3:20 pm (CST)

If you plan to attend this year, please join us at either session below and learn more about Smart Inventory Planning and Optimization as we highlight valuable features in our solutions. Epicor Insights 2022 will bring together more than 2,000 users of Epicor’s industry-specific ERP solutions for the manufacturing, distribution, and service industries. To learn more, visit INSIGHTS 2022.

Smart Software is an Epicor Platinum Partner and leading provider of demand planning, forecasting, inventory optimization, and analytics solutions. Our web platform, Smart IP&O, leverages probabilistic forecast modeling, machine learning, and collaborative demand planning to optimize inventory levels and increase forecast accuracy. You’ll use Smart IP&O to create accurate forecasts and optimal stocking policies that drive automated ordering in Epicor. The platform includes bi-directional integrations to both Epicor ERP and Prophet 21.

About Smart Software, Inc.
Founded in 1981, Smart Software, Inc. is a leader in providing businesses with enterprise-wide demand forecasting, planning and inventory optimization solutions. Smart Software’s demand forecasting and inventory optimization solutions have helped thousands of users worldwide, including customers at mid-market enterprises and Fortune 500 companies, such as Disney, Arizona Public Service, and Ameren. Smart Inventory Planning & Optimization gives demand planners the tools to handle sales seasonality, promotions, new and aging products, multi-dimensional hierarchies, and intermittently demanded service parts and capital goods items. It also provides inventory managers with accurate estimates of the optimal inventory and safety stock required to meet future orders and achieve desired service levels. Smart Software is headquartered in Belmont, Massachusetts and can be found on the World Wide Web at www.smartcorp.com.

For more information, please contact Smart Software, Inc., Four Hill Road, Belmont, MA 02478.
Phone: 1-800-SMART-99 (800-762-7899); FAX: 1-617-489-2748; E-mail: info@smartcorp.com

Drive Operational Efficiency and Boost Operational Excellence

Smart Software is pleased to introduce our new series of educational webinars, offered exclusively for Epicor Users. Greg Hartunian, CEO at Smart Software, will lead 45-minute webinar focusing on specific approaches to demand forecasting and inventory planning that will enable you to increase profitability, improve service levels, and reduce inventory holding costs. The presentation will outline the challenges associated with traditional inventory planning and demand forecasting processes and how new probabilistic forecasting and optimization methods will make a big difference to your bottom line. Finally, the presentation will conclude by showing how to increase profitability with software-enhanced inventory planning processes in a Live Demo.

WEBINAR REGISTRATION FORM

Please register to attend the webinar. If you are interested but not cannot attend, please register anyway – we will record our session and will send you a link to the replay.

We hope you will be able to join us!

SmartForecasts and Smart IP&O are registered trademarks of Smart Software, Inc. All other trademarks are the property of their respective owners.

For more information, please contact Smart Software,Inc., Four Hill Road, Belmont, MA 02478.
Phone: 1-800-SMART-99 (800-762-7899); E-mail: info@smartcorp.com

January 2022: Maximize service levels and minimize inventory costs

Smart Software specializes in helping spares carrying operations companies optimize their inventory. For example, a leading Electric Utility customer implemented Smart IP&O in just 90 days and reduced inventory by $9,000,000 while maintaining service levels.

Our Smart IP&O platform includes a patented probabilistic forecasting core engineered specifically for intermittently demanded spare parts. Please join our webinar featuring Greg Hartunian, CEO of Smart Software, who will show how to plan optimal inventory levels and purchase quantities for thousands of items when demand is intermittent, constantly changing, or affected by unexpected events. This webinar is an excellent opportunity to learn how to reduce stock-outs and inventory costs by leveraging data-driven decisions that identify the financial trade-offs associated with changes in demand, lead times, service level targets, and costs.

WEBINAR REGISTRATION FORM

Please register to attend the webinar. If you are interested but not cannot attend, please register anyway – we will record our session and will send you a link to the replay.

We hope you will be able to join us!

SmartForecasts and Smart IP&O are registered trademarks of Smart Software, Inc. All other trademarks are the property of their respective owners.

For more information, please contact Smart Software,Inc., Four Hill Road, Belmont, MA 02478.
Phone: 1-800-SMART-99 (800-762-7899); E-mail: info@smartcorp.com

Goldilocks Inventory Levels

You may remember the story of Goldilocks from your long-ago youth. Sometimes the porridge was too hot, sometimes it was too cold, but just once it was just right. Now that we are adults, we can translate that fairy tale into a professional principle for inventory planning: There can be too little or too much inventory, and there is some Goldilocks level that is “just right.” This blog is about finding that sweet spot.

To illustrate our supply chain fable, consider this example. Imagine that you sell service parts to keep your customers systems up and running. You offer a particular service part that costs you $100 to make but sells for a 20% markup. You can make $20 on each unit you sell, but you don’t get to keep the whole $20 because of the inventory operating costs you bear to be able to sell the part. There are holding costs to keep the part in good repair while in stock and ordering costs to replenish units you sell. Finally, sometimes you lose revenue from lost sales due to stockouts.

These operating costs can be directly related to the way you manage the part in inventory. For our example, assume you use a (Q,R) inventory policy, where Q is the replenishment order quantity and R is the reorder point. Assume further that the reason you are not making $30 per unit is that you have competitors, and customers will get the part from them if they can’t get it from you.

Both your revenue and your costs depend in complex ways on your choices for Q and R. These will determine how much you order, when and therefore how often you order, how often you stock out and therefore how many sales you lose, and how much cash you tie up in inventory. It is impossible to cost out these relationships by guesswork, but modern software can make the relationships visible and calculate the dollar figures you need to guide your choice of values for Q and R. It does this by running detailed, fact-based, probabilistic simulations that predict costs and performance by averaging over a large number of realistic demand scenarios.

With these results in hand, you can work out the margin associated with (Q,R) values using the simple formula

Margin = (Demand – Lost Sales) x Profit per unit sold – Ordering Costs – Holding Costs.

In this formula, Lost Sales, Ordering Costs and Holding Costs are dependent on reorder point R and order quantity Q.

Figure 1 shows the result of simulations that fixed Q at 25 units and varied R from 10 to 30 in steps of 5. While the curve is rather flat on top, you would make the most money by keeping on-hand inventory around 25 units (which corresponds to setting R = 20). More inventory, despite a higher service level and fewer lost sales, would make a little less money (and ties up a lot more cash), and less inventory would make a lot less.

Figure 1: Showing that there can be too little or too much inventory on hand

Without relying on the inventory simulation software, we would not be able to discover

a) that it is possible to carry too little and too much inventory
b) what the best level of inventory is
c) how to get there by proper choices of reorder point R and order quantity Q.

Without an explicit understanding of the above, companies will make daily inventory decisions relying on gut feel and averaging based rule of thumb methods. The tradeoffs described here are not exposed and the resulting mix of inventory yields a far lower return forfeiting hundreds of thousands to millions per year in lost profits. So be like Goldilocks. With the right systems and software tools, you too can get it just right!

The Next Frontier in Supply Chain Analytics

We believe the leading edge of supply chain analytics to be the development of digital twins of inventory systems. These twins take the form of discrete event models that use Monte Carlo simulation to generate and optimize over the full range of operational risks. We also assert that we and our colleagues at Smart Software have played an outsized role in forging that leading edge.

Overcoming Uncertainty with Service and Inventory Optimization Technology

In this blog, we will discuss today’s fast-paced and unpredictable market and the constant challenges businesses face in managing their inventory and service levels efficiently. The main subject of this discussion, rooted in the concept of “Probabilistic Inventory Optimization,” focuses on how modern technology can be leveraged to achieve optimal service and inventory targets amidst uncertainty. This approach not only addresses traditional inventory management issues but also offers a strategic edge in navigating the complexities of demand fluctuations and supply chain disruptions.

Centering Act: Spare Parts Timing, Pricing, and Reliability

In this article, we’ll walk you through the process of crafting a spare parts inventory plan that prioritizes availability metrics such as service levels and fill rates while ensuring cost efficiency. We’ll focus on an approach to inventory planning called Service Level-Driven Inventory Optimization. Next, we’ll discuss how to determine what parts you should include in your inventory and those that might not be necessary. Lastly, we’ll explore ways to enhance your service-level-driven inventory plan consistently.

Electric Power Utility Selects Smart Software for Inventory Optimization

Smart IP&O goes live in 90 days and reduces inventory by $9 million in the first six months

Belmont, MA., 2021 – Smart Software, Inc. provider of industry-leading demand forecasting, planning, and inventory optimization solutions, today announced its selection, purchase, and implementation of its flagship product, Smart IP&O, by a major US electric utility. The platform is now utilized to plan over 250,000 spare parts valued at over $500,000,000 across the Utility’s multi-echelon distribution network. Smart IP&O was implemented in just 90 days and has been credited for reducing inventory by $9 million while maintaining service levels within its first six months of operation.

The implementation of Smart IP&O is part of the Utility’s Strategic Supply Chain Optimization (SCO) initiative to replace twenty-year-old legacy software. Subsequent phases of the Smart Software implementation will integrate Smart IP&O to their IBM Maximo Asset Management system.

Key to the selection and success of the project to-date is Smart Software’s proven track record planning intermittent demand that is prevalent on spare and service parts. Intermittent or lumpy demand is characterized by frequent periods of zero demand interspersed with large spikes of non-zero demand that seemingly occur at random. The Utility estimates that over 80% of its parts have intermittent demand. Smart Software leverages probabilistic forecasting that creates thousands of possible future outcomes of demand and lead times. The technology’s proven ability to accurately forecast the required inventory to achieve the high levels of service the Utility requires and to do so at scale were critical differentiators.

Implementation was accomplished within 90 days of project start. Over the ensuing six months, Smart IP&O enabled the adjustment of stocking parameters for several thousand items, resulting in inventory reductions of $9.0 million while sustaining target service levels. Significant additional savings – and improvement in service levels for critical spares – are anticipated in the coming year as stocks for additional facilities are brought into the system.

“We have had many very strong successes helping customers in asset-intensive industries optimize their parts inventory,” said Greg Hartunian, CEO of Smart Software. “Combined with the Utility’s support from the top-down, hands-on involvement from IT, and user enthusiasm to embrace a new approach, we had a great recipe for success. We look forward to building on our early success to deliver even more value together.”

About Smart Software, Inc.
Founded in 1981, Smart Software, Inc. is a leader in providing businesses with enterprise-wide demand forecasting, planning, and inventory optimization solutions. Smart Inventory Planning & Optimization is a multi-tenant web platform that gives demand planners the tools to handle sales seasonality, promotions, new and aging products, multi-dimensional hierarchies, and intermittently demanded service parts and capital goods items. The solution provides inventory managers with accurate estimates of the optimal inventory and safety stock required to meet future orders and achieve desired service levels. Smart Software is headquartered in Belmont, Massachusetts, and can be found at www.smartcorp.com.

SmartForecasts and Smart IP&O are registered trademarks of Smart Software, Inc. All other trademarks are the property of their respective owners.

For more information, please contact Smart Software,Inc., Four Hill Road, Belmont, MA 02478.
Phone: 1-800-SMART-99 (800-762-7899); E-mail: info@smartcorp.com