Constellation of Beauty (ABM Inventory)

2015

Prerequisites of the Project

For achievement of operational and financial performance of network a necessary condition is control of key indicators: sales and stocks. Stocks should provide necessary sales level on the one hand and not result in excesses with another. The management tool and control of a status of trade inventories is for this purpose necessary.

At the time of preproject inspection of the company, all orders of network formed in a semi-automatic mode using the commodity accounting system of 1C and Excel. In the accounting system there was an assortment matrix on groups of shops (without detailing for each shop) therefore determination of the range of shop needed to be updated at each order. Such approach to formation of orders required big time expenditure and generated the inevitable errors connected with a human factor. Also in the accounting system there was no possibility of the analysis of dynamics of stocks, sales were analyzed only. Therefore it was impossible to estimate the level of commodity excesses.

The above-named reasons negatively affected quality of management of trade inventories, and, as a result, efficiency of all network.

Top management made the decision to optimize and automate a management system for stocks, to implement additional instruments of control of the level of trade inventories.

Results and effects

In Constellation of Beauty company the centralized control system of stocks of ABM Inventory under control of which there are 100% of all range is implemented. From May, 2015 till January, 2016 the following results were achieved:

• 1. On the Moscow region:
  • Stocks were reduced by 8.7% at sales growth;
  • The missed sales were reduced by 8.1%;
  • Excesses were reduced by 30%;
  • The turnover improved by 2.5 times.

• 2. On other regions:
  • Stocks were reduced by 21.2% at sales growth;
  • Excesses were reduced by 36.1%;
  • The turnover improved by 1.9 times.

• 3. On wholesale division:
  • Stocks were reduced by 38.4% at sales reduction;
  • The missed sales were reduced by 27%;
  • Excesses were reduced by 68.3%.

• 4. Orders are automated also process of the order, as well as inventory management in general, became transparent;
• 5. The scheme of the order of promotional goods is optimized.