01:18
Faizan
Want to know how you can carry little inventory and still support your maintenance projects?
Drumroll please.
Through proper planning.
On the eve of a particular Monday I received a "list" of a 100 line items in the form of a good 'ole consumable / expendable RFQ. You know, the sealants, wire, tape, nuts and bolts type.
Myself and the sales support team began processing the RFQ but something was off.
Something wasn't right.
Each line item I looked at was ordered last quarter.
I began to wonder why this particular airline was re-creating a process they had already completed the prior quarter.
My mind immediately envisioned a simpler way.
Through proper planning and communication this exaggerated process is 100% avoidable.
After they purchased this requirement "again" they spent an additional $10,000 on labor, processing, shipping and other nuances.
No prices increased and some items had lead times that they had to accommodate.
With proper planning they could have saved $10,000, increased efficiency and avoided stock out delays.
Stock out delays result in increased purchases which leads to excess inventory do to "trying" to avoid the issue in the future.
An inefficient purchasing system
Sending out RFQs to the entire world is a common practice but is it the most efficient?
Industry norm of the send RFQ and watch the flood of quotes come in is okay, but it isn't efficient.
And it isn't a viable way to increase vendor reliability as the floodgates of various sources rush in.
This creates improper forecasting, stock buildup, and additional costs to your procurement process.
By the time you receive the quotes, process them and cut the PO, the order cycle has been dramatically extended.
Drumroll please.
Through proper planning.
On the eve of a particular Monday I received a "list" of a 100 line items in the form of a good 'ole consumable / expendable RFQ. You know, the sealants, wire, tape, nuts and bolts type.
Myself and the sales support team began processing the RFQ but something was off.
Something wasn't right.
Each line item I looked at was ordered last quarter.
I began to wonder why this particular airline was re-creating a process they had already completed the prior quarter.
My mind immediately envisioned a simpler way.
Through proper planning and communication this exaggerated process is 100% avoidable.
After they purchased this requirement "again" they spent an additional $10,000 on labor, processing, shipping and other nuances.
No prices increased and some items had lead times that they had to accommodate.
With proper planning they could have saved $10,000, increased efficiency and avoided stock out delays.
Stock out delays result in increased purchases which leads to excess inventory do to "trying" to avoid the issue in the future.
An inefficient purchasing system
Sending out RFQs to the entire world is a common practice but is it the most efficient?
Industry norm of the send RFQ and watch the flood of quotes come in is okay, but it isn't efficient.
And it isn't a viable way to increase vendor reliability as the floodgates of various sources rush in.
This creates improper forecasting, stock buildup, and additional costs to your procurement process.
By the time you receive the quotes, process them and cut the PO, the order cycle has been dramatically extended.
Posted in: business
