Operating within budget: inventory spend planning and control
Inventory decisions change working capital and spend. Operations need to know the impact before a change is made, and to keep daily ordering within budget.
The challenge
Changes to stocking strategies, policies and service levels alter the inventory profile. Without a view of the impact, inventory value and spend can move well away from budget before anyone notices. Day to day, orders are released one by one, and totals only become visible at month end.
Understand the impact of planned changes
See how planned changes to the inventory profile affect inventory value and spend before they are applied
Compare the projected impact of alternative scenarios
Track the projected position against budget over time
Control budgets day to day
Apply budget constraints during planning, so recommended orders respect available budget
Limit daily order value
Track and control monthly order totals
Prioritise orders when the budget is constrained, so critical items come first
Budget becomes part of the planning process rather than a check after the fact. Planners see the financial effect of their decisions as they make them, and approvals are recorded.