ACI Infotech successfully implemented an Inventory Optimization Solution to identify the inventory pileup for a furniture manufacturer​

A Dallas-based Furniture Manufacturer

Goals/ Challenges

Goals

  • To identify the reasons for inventory pileup
  • To identify the optimized inventory level of raw material which needs to be maintained

Challenges

  • Integration of available statistical tools with the ERP systems to gather data 
  • External factor like the price of raw material to be taken into consideration 
  • Insufficient industry data on various influencing factors

Our Solution/ Approach

Solution

  • Correlation analysis between the stock level and factors like consumption, production, and sales
  • Month-wise and year-wise variable importance analysis on stock levels by various factors
  • Causal analysis to identify the factors responsible for inventory pileup

Approach

  • Identified the patterns and trends of the stocks using historical stock level data
  • Aging analysis to review the contribution of stock from the past that led to the present-day inventory pile up 
  • Time series and regression modeling to identify the features that influenced the inventory

Case Study