As I mentioned in my last three posts (Tip #1, Tip#2, Tip#3) companies are looking for ways to decrease operating expenses during this tough economic time. Here is Tip #4 for how to cut costs by utilizing Microsoft Dynamics GP solutions…
#4 Optimize Inventory Levels Optimizing your inventory levels is a key way to cut costs. The amount of inventory that needs to be kept on hand will depend on the characteristics of each particular business. Inventory should not be reduced to the point where sales and service are negatively affected, but there may be some strategies that can be used to reach a proper balance, to keep inventory levels down but still satisfy customer and internal demand.
Much of the difficulty lies in knowing when to reorder items and how much to reorder. Microsoft Dynamics GP has a Purchase Order Generator that will assist with this process. The Purchase Order Generator determines quantities needed based on the stock situation in relation to the stock goals and generates a suggested purchase order that can be reviewed and edited prior to release. The PO Generator works with an item's Order Point Quantity to determine if a purchase is required. If the supply of an item is less than its demand plus the order point quantity, a purchase will be suggested. PO Generator can select the vendor based on the Primary Vendor assigned to the item, the vendor with the lowest cost or the vendor with the shortest lead. This solution helps automate the reordering process helping businesses maintain optimal inventory levels.
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