Procurement & LogisticsVictor Dam / 3 June 2022 /
We are proud to announce a variety of improvements in our modus-operandi regarding the procurement and associated logistics of DropNet products. Quarter 4 of 2021 saw the implementation of a Warehouse Management/Inventory Management System, in conjunction with the adoption of a Purchase Order-Work Order system.
This implementation poses a significant improvement in the procurement and shipment process – our Inventory Management System allows our procurement analysts to forecast inventory levels for individual products and consequently streamline and improve re-ordering cycles. We believe that through the use of our Inventory Management System, DropNet will be able to reduce shipping costs by being able to effectively combine product shipments (i.e., bulk shipments), as well as reduction of “Stock-out days”, i.e., number of days in which a product is out of stock.
Further insight into the stock levels have also allowed the company to take measures outside of procurement and logistics, namely, insight into stock levels has allowed our advertising associates to change advertising campaigns based on current stock levels, forecasted lead times, and forecasted stock-out days – essentially, campaign budgets can be reduced or completed terminated pre-emptively, effectively reducing advertising costs and slowing sales velocity. We hope that these “inventory-based” decisions will lead to a further reduction in stock-out instances, as well as a reduction of advertising costs, and consequent improvements of Amazon’s IPI scores.
Most importantly, the implementation of our Inventory Management System has brought a new level of accountability and insight into Warehouse Operations and any stock currently held by DropNet. We have created extensive SOPs that work together with our Inventory Management system and delineate the process for receiving or dispatching any shipments at the DropNet warehouse. Any purchases made are assigned a Purchase Order and Work Order delineating any actions required for the proper storage and intake of incoming shipments, which are then attached to a control form signed by our Warehouse Manager and sent back to the Procurement Associate/Consultant and Procurement Manager.
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