Following the Metrics Trail Solves an Inventory Problem

The retailer was relying on POS data to reorder stock that was not synchronized with actual in-store inventory. The supplier, sensing that the POS metrics were misleading, scheduled production runs based on their own historical data. Consequently, production was increasing at the same time store sales were declining (paint is a seasonal product). The (very expensive) result was a total system inventory of four-to-five times sales, which translated to an average of five month’s excess inventory across all product lines.