INVENTORY REPLENISHMENT
Inventory replenishment, otherwise known as stock replenishment, refers to the process of
inventory moving from reserve storage to primary storage, then onto picking locations. It’s
important to note that inventory replenishment is sometimes used to define both ready-to-
sell inventory as well as raw materials received from suppliers. It is a standard retail
practice, to ensure that the right products are at the right place, at optimum quantity.
Retailers can automate replenishment using intelligent algorithms, which can be particularly
beneficial during promotional or seasonal events. Replenishment is essential to avoid stock-
outs.
Increased speed to sell is just one of the benefits of optimum stock replenishment, ensuring
that the customer is delivered the item that they demand, in increasingly fast timescales.
Dependable automated replenishment, reducing the possibility of stock-outs, improves the
customer experience by ensuring that products are more readily available across all
channels, avoiding the dreaded “out of stock”.
Stock replenishment isn’t just a process: analytically speaking, it can also help retailers to
forecast more accurately with complete visibility of their global inventory and demand.
Performance at SKU/Site level is automatically reviewed and ideal stock levels can be
increased or decreased accordingly, enabling more full price items to be sold. Changes to
future stock levels can also be forecast and systemically defined prior to specific activity e.g.
promotional events.
BENEFITS OF OPTIMUM INVENTORY REPLENISHMENT
Optimised sales: Order the right amount of product, to be delivered at the correct time, to the
best place. Better stock replenishment maintains optimum inventory levels on all products so that
you can sell more effectively where and when it is needed.
Reduced mark-downs: Optimised stock levels allow you to fulfil your customer demand with
fewer stock outs. With a greater sell through of full priced stock and a reduced rate of markdown,
margins are protected and profits soar.
Maximise stock turn: Confidently fulfil customer demands without inflating your levels of
inventory, preventing over and under stocking, both of which damage business profitability.
CHALLANGE
Challenge
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ANNEXURES
S.no. Product Quantity Total Order Ordered Date
Name ordered Value
1. Shoes 30 34,440 09/03/2019
2. Shoes 60 2,63,880 27/02/2019
3. Shoe Polish 344 1,75,804 12/03/2019
4. Unisex Cap 278 1,61,048 12/03/2019
5. Wallet 199 65,862 28/03/2019
6. Socks 47 5,038 12/03/2019
*The order placing sheet of the above-mentioned products are further attached
RECOMMENDATIONS
1. Woodland can use Multi-Location Inventory Redistribution as they have their
warehouse only in Delhi. In a multi-warehouse operation, some warehouses may have
an excess of stock, while others may struggle to fill orders due to high item turnover
ratios. Being able to redistribute stock between warehouses efficiently can keep stock
levels at optimum levels whilst maintaining service levels.
2. Implementation of software, like EazyStock, helps to eliminate excess stock, and this in
turn can reduce the carrying costs of the overall inventory. The elimination of excess
stock reduces the need for storage space, while the automation of inventory
management software helps to reduce back-office staffing and the number of warehouse
operatives need to maintain efficient operations.
3. Woodland should maintain the mechanism of Maintenance of safety stock as
the Customer demand is seldom completely predictable: Just in Time (JIT) supplier
delivery for wholesale distributors is often times too risky, so a certain amount of
emergency stock needs to be kept for your highest turnover items to ensure customer
demand is satisfied. ABC Analysis can help operations managers better understand
which items are classified as high or low priority.
4. Woodland can follow a fixed replenishment strategy this will help them save the time
and efforts required in calculation of economic order quantity as fixed replenishment
strategy eliminates the need to calculate the EOQ.
5. Woodland can Evaluate the key performance indicators (KPIs) tied to strategy,
performance, and stakeholders for replenishment managers, these usually are in-stock
status; Customer Relations ratio, or fill rate; and arrival date.
https://retail-assist.co.uk/what-is-stock-replenishment/
https://www.onenetwork.com/supply-chain-management-solutions/solution-templates/retail-
replenishment/
https://6river.com/what-is-inventory-replenishment/
