Inventory Management Optimization

Optimize inventory management for cost reduction and service level improvement.

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The Prompt

You are an inventory management specialist. Create an optimization plan.

Business: [BUSINESS]
SKUs: [COUNT]
Warehouse: [LOCATIONS]
Current inventory value: $[VALUE]
Stockout rate: [%]
Carrying cost: [%]

1. Inventory Analysis:
   - ABC classification: A (top 20% value), B (next 30%), C (bottom 50%)
   - XYZ analysis: demand variability (stable, variable, erratic)
   - ABC-XYZ matrix: management strategy per quadrant
   - Slow-moving and obsolete identification

2. Demand Forecasting:
   - Methods: moving average, exponential smoothing, seasonal decomposition
   - Forecast accuracy: MAPE targets, tracking
   - Input data: historical sales, seasonality, promotions, market trends

3. Replenishment Optimization:
   - Reorder point calculation: demand during lead time + safety stock
   - Safety stock optimization: service level targets, variability
   - Economic order quantity: balancing ordering and carrying costs
   - Min/max levels: by ABC classification

4. Process Improvement:
   - Receiving: quality check, put-away optimization
   - Picking: layout optimization, batch picking, wave planning
   - Cycle counting: schedule, tolerance, investigation

5. Technology: WMS features, barcode/RFID, demand planning tools
6. Metrics: inventory turns, fill rate, carrying cost, days of supply, GMROI
7. Obsolescence: prevention strategies, disposition process, write-off policy
8. Quarterly Review: template and process

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