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A company found itself nearly collapsing under the weight of its inefficient purchasing department. The core issue lay in a flawed forecasting model that indiscriminately suggested purchasing both slow-moving and fast-moving inventory without considering crucial factors like inventory storage costs, capital costs, and the risk of obsolescence due to market changes.
This oversight led to excessive cash consumption and associated costs, further exacerbated by a lack of coordination between the sales and purchasing teams. The purchasing department operated in isolation, relying on outdated sales forecasts that were frequently revised, rendering the initial purchasing plans obsolete.
Additionally, the inventory management system was flawed, complicating the verification of received goods against orders, leading to discrepancies and inefficiencies.
Thanks to the strategic overhaul of our purchasing process, we’ve significantly improved cash flow, reduced waste, and streamlined inventory management. This transformation has not only stabilized our operations but also set us on a path to sustained profitability and growth.
Kate Thomas
Co-Founder
Our intervention focused on creating a unified, data-driven approach to inventory management. We introduced a centralized sheet that updated SKU-level sales data daily, linking it with warehouse reports for real-time accuracy.
Our forensic accounting efforts involved meticulous reconciliation processes and audits of all transactions over the past five years. This exhaustive review not only required advanced accounting expertise but also strategic negotiation skills to address past overpayments and revenue leaks.
This streamlined system not only ensured that purchasing decisions were aligned with real-time sales data but also significantly improved inventory accuracy through the introduction of barcode scanning for tracking stock movements.
The restructuring and outsourcing strategy bore immediate and tangible benefits
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