The training course INVENTORY & REPLENISHMENT PLANNING has the following objectives:
- – Introduce the attendees into the business context of Inventory & Replenishment Planning, explaining the activities for planning the inventory of the products (stock sizing and control) across the Supply Chain networks and for planning the distribution / reorders of Stock Keeping Units at the customer locations.
- – Show the processes, the typical inputs and outputs of Inventory Management & Control systems, and also the quantitative parameters used to project and size these planning systems.
- – Show how to build a KPI dashboard to evaluate the inventory levels and the quality of a replenishment plan
- – Analyze the most frequently used methodologies for planning the inventory levels on the distribution / production nodes of the Supply Chain.
- – Show the methods and the formulas for calculating safety stock.
- – Explain the policies of store replenishment (re-assortment of point of sales or customer location, from production plants / logistic warehouses) and of inventory allocation (product stocks allocation from warehouses to stores).
- – Inventory & Replenishment Assessment: define the steps for a reengineering project of the inventory & Replenishment planning system.
The training course INVENTORY & REPLENISHMENT PLANNING aims to provide answers to the following questions:
- – Which are the processes, the steps and the typical workflows of the macro-process “Inventory & Replenishment Planning”?
- – Why is it important to control the inventory? Which are the related costs to the inventory planning of stocks into the Supply Chain stages?
- – How to plan and how to measure the customer service level?
- – Which are the typical Key Performance Indicators for a dashboard monitoring and controlling product inventory levels?
- – Which are the specific methods and techniques of Inventory Planning? How to control the levels of stocks of SKUs at locations?
- – Which are the most common methods to determine the gross and net requirements of products at customer locations (Replenishment Planning)?
- – How to quantify the safety stock?
- – How can we collaborate with customers and suppliers to maximize the global Supply Chain service level while minimizing inventory?
- – Which are the step for building a DRP system?
- – How to manage slow moving items / class C items / spare parts?
- – How to associate the best replenishment algorithm to the combination item / warehouse?
1. Inventory & Replenishment Planning
- – Inventory Planning in the context of Supply Chain networks of production and distribution systems
- – The role and the importance of inventory in the integrated Supply Chains
2. Stock classification
- – Cycle stock, safety stock, strategic stock, in transit stock, obsolete stock
- – Analysis of each stock category, with numerical examples
3. Costs related to inventory & replenishment
- – Inventory holding costs, stockout costs
- – Setup costs, logistics costs
- – Numerical examples
4. Inventory Planning and Customer Service Level
- – Definition of customer service level
- – KPIs for measuring the customer service level (OTIF, Fulfillment rates)
- – Customer service level target definition: methods
5. KPIs for measuring effectiveness of Inventory Planning policies
- – Average Inventory Level
- – Inventory Turn
- – Inventory coverage index (Days Inventory Outstanding)
- – ABC Analysis of inventory – revenue for products / customers
- – Formulas to calculate the length of stock coverage intervals
6. Replenishment Planning policies
- – Inventory Management (pull methods)
- – Material / Distribution Requirements Planning (push methods)
- – Replenishment algorithms: reorder point, economical order quantity, minimum – maximum, coverage interval
- – Calculation of economical lot size (Wilson’s formula)
- – “Mixed” models: optional reorder, inventory level control
- – Numerical examples of replenishment algorithms
- – DRP methodology: input and output data, step to project a DRP system, KPI and reporting definition, replenishment algorithms’ choice. Simulation of business cases with Microsoft Excel on two stages (warehouses to stores; plants to warehouses)
- – Lot sizing and lead time management in DRP systems
7. Safety stock
- – Variability of customer demand and supplier lead time
- – Safety stock and customer service level
- – Formulas for static and dynamic safety stock
8. Replenishment for sporadic items
- – Poisson’s model for slow moving items
- – Numerical examples of calculation
9. Stock Allocation
- – Methods for real-time stock allocation to customers: priority list, setup, Sell-Through
10. Collaborative Planning methods: VMI and CPFR
- – Consignment Stock, Continuous Replenishment Program
- – Workflow and rules for Vendor Managed Inventory systems
- – Workflow and rules for Collaborative Planning Forecasting & Replenishment systems