Achieving a Remarkable 13% Revenue Growth and Reclaiming 20 Hours Monthly Through Effective Inventory Management System Implementation

Project Summary

This 8-figure tool brand came up with the challenges related to inventory management,
demand uncertainties and issues with Amazon Global Logistics. 
Brankit implemented an efficient system for inventory management, resulting in a 25%
reduction in Inventory Levels, saving 20 hours/month and a staggering 13% YoY Revenue Increase with 3% Growth in Net Profit.

Initial Hurdles

  1. Inventory Management Complexity: The Client was struggling with keeping the track of stock levels, POs and shipments resulting in stock outs and overstocking issues.
  2. Demand Forecasting Uncertainty: Demand planning process was based on guesses and recent sales only creating problems in making decisions about purchase orders.
  3. Operational Overload: Managing 3PL and supplier communications, manual dashboards and data updates along with other aspects of the business was causing serious burden in seller’s life
  4. Cost Inefficiencies: The client was lacking a comprehensive view of their procurement and shipping expenses making it difficult to pinpoint opportunities for more profits and process optimization.
  5. High Working Capital: Extra on-hand inventory and delays in receiving inventory was resulting in a high working capital for running the brand.

Plan of Action

To address the inventory management challenges faced by our client, Brankit devised a comprehensive plan:

  1. Flieber Integration: Onboarding the brand onto our inventory management and demand forecasting software for real-time visibility of inventory levels and demand forecasts.

  2. Integrating Marketing With Forecasts: Brankit implemented a process through IMS to include marketing inputs in the forecast generating 90% reliable data.

  3. Operational Takeover: Brankit assumed day-to-day operations, managing 3PL and supplier communications, overseeing Amazon FBA shipments, and handling international shipments from supplier to Amazon and 3PL.

  4. Order-Up-To-Level Model: Applied OUTLM to the portfolio to segment and assign min/max levels at SKU level, and curated purchase orders (POs) to maintain optimal inventory balance.

  5. Utilizing Amazon Logistics: Transitioned brand to an optimize logistics flow using Amazon Global Logistics (AGL) and Warehouse Distribution (AWD) improving bottom-line profits.

Reporting Structure: Implemented regular reporting, including inventory value and expenses reports with weekly check-ins with client, enabling better tracking of procurement and shipping costs.

Outcomes Achieved​

  1. Improved Inventory Control: Real-time visibility and accurate forecasts led to a remarkable 25% reduction in Inventory On-hand. This strategic reduction in inventory levels significantly mitigated stock-out and overstocking issues achieving 99% In-stock Rate and optimal stock levels.
  2. Enhanced Demand Forecasting: By integrating marketing inputs into the forecasting process, Brankit achieved a remarkable 90% reliability rate allowing precise decision-making regarding purchase orders.
  3. Operational Efficiency: With Brankit taking charge of day-to-day operations and introducing automations, operational time was cut down by 20 hours per month. The CEO reclaimed about 40 hours/month allowing a sharper focus on business growth.
  4. Streamlined Inventory Optimization: Implementing the Order-Up-To-Level Model (OUTLM) led to a finely-tuned inventory balance, reducing excess stock levels and contributing to significant cost savings with more focus on high performing SKUs.
  5. Maximized Amazon Logistics: The streamlined logistics strategy using Amazon Global Logistics (AGL) and Warehouse Distribution (AWD) contributed to a 3% increase in overall profit margins.
  6. Financial Insights and Control: The introduction of regular reporting, encompassing inventory value and expenses, provided invaluable insights for process refinement and cost reduction leading to a 30% increase in Year on Year revenue.

Lee Leathers, CEO of Jaeger Tools:
“This team is top-notch! I learned a ton while they
improved our systems, reduced our doc to an optimal level,
and took lots off our plate. A+”

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