Save 1.44% of annual revenue or more with GMDH Streamline inventory optimization software
During a conversation with a food distributor in the LATAM region, who’s a third-year customer of GMDH Streamline, we learned that the customer estimates their savings around $120,000 a month after implementing Streamline as their inventory optimization solution. In their case, that means the savings are 1.44% of their $100M annual revenue every year , and indeed it’s a very good result. When we share this success case with our prospective customers we often are asked to explain what our planning platform does differently that allows ROI to scale with the company size.
Reducing holding costs
Most savings come from preventing excessive inventory holding. Excessive inventory adds to warehousing costs, cost of capital that depends on your annual interest rate, insurance cost, and labor cost. Streamline uses replenishment strategies with low maximum and average inventory levels that, in turn, reduce frozen capital and minimize holding costs.
Reducing lost sales
Interviews during the COVID-19 outbreak revealed that 60% of retail buyers are willing to wait an extra three to four days for delivery, while 19% were comfortable with five to six days and 17% said more than seven days is acceptable. That means one week out of stock would push 83% of customers to buy the desired product from a competitor. Would they come back at all?
GMDH Streamline can get rid of shortages almost completely, except supplier/delivery failure cases. That brings 83% of currently unsatisfied customers back to your pipeline and the final ROI will depend on the number of days out of stock you currently have.
Reducing team inefficiency
Time is one of the most precious resources that we turn into money when it’s spent wisely. However, deciding what to purchase may drain a lot of time from your whole team. Forecasting in Excel, calculating what to purchase, agreeing on your plan with marketing, sales, and executives can’t be that quick and easy unless you are using a planning platform like Streamline. The platform automatically extracts data from your ERP, prepares a baseline plan automatically, allows stakeholders to commit adjustments when they have some free time as opposed to blocking out everyone for a live meeting, and finally, you can get all suggested orders uploaded to the ERP system automatically for your approval.
We’ve seen companies that live in Excel and spend 2 weeks every month to come up with the purchasing plan and spend lots of time across the entire team on that. But once they automate their planning process, they can focus on growth. It’s very inspiring to see results like a 60% revenue increase in one year after implementing Streamline for a manufacturer in Asia. And that drives our team to constantly improve the platform delivering even more efficiency and automation.
Do you want to test Streamline with your company’s data? Download the latest version and try it now!
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- How to deal with supply chain processes during the Coronavirus outbreak
- Why switch from Excel to inventory planning software
- Must-read: Smart Supply Chain Management solutions for business processes optimization
- Cross-Functional Alignment in Supply Chain Planning: A Case Study of Sales and Operations Planning [PDF]
- Demand & Supply Management: Collaborative Planning, Forecasting & Replenishment
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- 99+% inventory availability.
- Up to 99% forecast accuracy.
- Up to 98% reduction in stockouts.
- Up to 50% reduction in excess inventory.
- 1-5 percentage points margin improvement.
- Up to 56X ROI in one year. 100% ROI in the first 3 months.
- Up to 90% reduction in time spent on forecasting, planning, and ordering.