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Three Steps to Reduce Unproductive Stock
Distributors should ideally be able to manage inventory turnover but many know that determining the right amount of inventory to have on hand is tricky and requires accurate inventory forecasting.Industry averages show that dead inventory accounts for 10 to 30 percent of distributors’ inventory. Even at 10 percent, for every $500,000 in inventory, it’s a good possibility that $50,000 is dead. Storage, labor, utilities and insurance costs can make up 20 to 30 percent of the cost of the unproductive stock. That’s another $10,000 eroding your bottom line on products on products that won’t sell.
Report Snap Shot
This white paper outlines the ways in which you may improve your balance sheet and operations by reducing unproductive stock.
