The three questions we get asked by agencies, brands and/or retailers the most often are:

1. how can we more easily access our data? 
2. is there a simple way for us to identify what we need to focus on to improve our ad performance?
3. how do we know how much to spend on inventory? 

​Getting your data out of Amazon and maintaining it is very difficult, and Amazon isn’t in a hurry to help you.  For that reason, we have built DATA STUDIO.  Firstly, it is a simple tool that helps you connect to your account(s).  Once connected, your data is securely stored so you can review it using our views.  Secondly, because we are maintaining and backing up your data in your own dedicated data warehouse, we provide easy access to it so you can link it to your own BI tool for custom reporting.

Amazon doesn’t tell you where you could better allocate your advertising spend based on the success or failures of your current campaigns and keywords.  Instead, you need to have some type of analytics tool to highlight where you should focus your attention so you can take immediately action.  Our ADVERTISING STUDIO is setup for you to review, drill-down and action your amazon campaigns and keywords to improve your advertising performance.

Everyone listed on Amazon knows that not having inventory can impact your search placement.  So, it’s important to manage your cash flow so you don’t run out.  Our INVENTORY PLANNING software walks you through the process of managing your open-to-buy spend so you can better allocate your ordering budget based on inventory goals, sales targets, and planned receipts.  After all, you don’t want a lack of inventory to negate all the work you’ve done to optimize your advertising performance. 

Want to learn more...check out our video.

Cycle stock optimization is how you set your item-level ordering quantities based on the costs of holding your forecasted inventory versus the transaction costs of ordering and receiving it.  The economic ordering quantity formula is a well-known model of cycle stock strategy that considers some of these cost trade-offs.  Your cycle stock represents half of your ordering quantity.  Cycle stock, however, is often driven by minimums and multiples like case pack quantities.  Cycle stock optimization considers forecast, numerous carrying and ordering costs and any line-item ordering constraints.  Generally, your cycle stock strategy makes up most of the inventory you have stocked which is why it is important to manage in your inventory optimization and strategy policies.  By planning and optimizing your cycle stock, you can achieve significant service levels without holding any safety stock. ​

I often get asked what the difference is between inventory management, planning and optimization.  It is an important question and one that needs to be answered and understood, especially when you are looking to purchase software to help you with your inventory.  There is, of course, some cross over, between the three (picture a Venn diagram), so I will provide some examples to best describe and highlight how they are each unique in their own way.

Inventory Management is often misused to describe inventory planning and inventory optimization.  Although, it does and should include some inventory planning, like a min/max type of inventory policy, it almost never includes inventory optimization.

Think of Inventory Management as the tracking and trace-ability of inventory through out the supply chain.  A good example would be RFID tracking.  Using bar coding to track and know where your inventory is in your network at any given time is the simplest and most unique way to differentiate that which Inventory Management does, but inventory planning and optimization do not.

Inventory Planning is what most companies look for to understand their inventory position and to control their inventory levels and investment.  Inventory Planning in its simplest form is included with Inventory Management.  And, an optimal inventory plan will and should include Inventory Optimization.  So, they are intertwined and Inventory Planning sits in the middle.

Back to what exactly is Inventory Planning.  From a bottoms-up perspective (i.e., item by location), it is a proactive inventory policy that defines what your cycle stock and safety stock should be.  The policies are such that they can be forward looking to help you understand where your inventory investment will be.  A typical example is calculating policies by the number of days of forecast you should order and stock, respectively (e.g., days of supply).

From a top-down perspective, Inventory Planning is the forward looking investment in inventory spend.  This is generally performed at a product category level and deemed to be your open-to-buy budget and extremely popular among retailers where working at the item by location level can be cumbersome (especially in fashion).

Inventory Optimization can be viewed as a sophisticated inventory plan.  It takes on two forms, a bottoms-up inventory plan and a top-down inventory plan.

The top-down inventory plan, if optimized, can be referred to as network optimization.  It is the optimal inventory investment for all stocking locations and all items within a distribution network.  The bottoms-up plan if optimized is referred to as multi-echelon inventory optimization.  This is the item by location inventory plan for each item at every stocking location.  To be optimized at this level, safety stock is driven by a service level target and the cycle stock is derived by the trade-off in carrying and ordering costs.  

Reconciling both the bottoms-up and top-down plan is the key to optimizing the inventory investment. The end result being a forward-looking, time-phased replenishment plan that takes into consideration how wrong the forecast is, the variability in lead-time, your service level objectives, the costs of inventory,  and the budget and investment constraints of your business.

Each business has its unique needs and issues. If you are looking for Inventory Management, a warehouse management software will generally have the functionality you are looking for.  But, if you are looking to manage and control your inventory spend and investment so your inventory does not get out of control, I recommend starting with the simplest approach - a top-down software like open-to-buy planning.  Start with managing your sales objectives, your purchase orders, your profit and margin targets, and from there back into an inventory budget that you are comfortable with.  Translate that budget into a prioritized list of orders, hence balancing your financial goals with your assortment.