Gartner Research

Cover Considerations — How to Optimize Retail and Consumer Product Inventory Targets

Published: 15 February 2017

ID: G00324360

Analyst(s): Tom Enright

Summary

Many companies use subjective methods in determining how much inventory to hold in distribution centers and stores. This research identifies three key considerations supply chain leaders should use when calculating optimal inventory holding targets without jeopardizing sales.

Table Of Contents
  • Key Challenges

Introduction

Analysis

  • Consider How Order Supply, Order Reliability and Customer Demand Impact How Product Flows Through the Supply Chain; Use These Considerations to Optimize Inventory Cover Targets
    • Order Supply Considerations
    • Order Reliability Considerations
    • Customer Demand Considerations
  • Apply a Specific Focus to Key Products by Assessing Their Individual Needs Against the Cover Considerations to Set Efficient Inventory Targets
    • Order Supply Considerations
    • Order Reliability Considerations
    • Customer Demand Considerations
  • Optimize the Accuracy of Setting Inventory Cover Targets by Obtaining Input From Merchandising, Buying, Logistics and Demand-Planning Teams

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