The client – is an American multinational designer toys manufacturing company. The firm employs over 20,000 individuals.
The designer toys manufacturer’s primary aim was to decrease raw material and packaging material inventories in their manufacturing units and the finished goods inventories in their distribution centers. Additionally, the client wanted to drive efficiency and cost improvements across their supply chain.
With the help of SpendEdge’s inventory management techniques, the designer toys manufacturer better managed raw material and packaging material accounts at a factory level and made better planning decisions leading to lower finished goods inventories in the supply chain. Additionally, the client devised an agenda to categorize high inventory raw material and packaging material items and the key drivers leading to high inventories.
Inventory management challenges
Seasonal Demand fluctuations: Due to holidays, school breaks, and special events like birthdays, the toy business sees significant seasonal demand swings. Extreme changes in demand may come from this, which may cause overstocking or understocking problems. To prevent stockouts during peak periods and high inventory levels afterwards, retailers must effectively estimate and plan for these demand swings.
New Product Introductions: The toy industry’s ongoing innovation drives the regular release of new items. Companies need to find a way to balance accommodating the influx of new products with maintaining inventory levels of their existing products. Failure to maintain this equilibrium could result in shortages of in-demand new toys and surpluses of older toys.