Business - Management Ezine Articles

Lance is retired at 40 and running an Online Think Tank while traveling North America. Considering something extremely challenging to exercise his mind and utilize all his experiences, observations and skills. Any ideas?

In the meantime lance is looking for co-authors to help on a few books;

Artificial Intelligence; Possible Futures, Comets & Earth Civilizations, Computer Brain Interfaces, Economics of 21st Century, Franchising the World, Future Auto Tech, Future Aviation Tech, Future Concepts, Future Underwater Tech, Growing Our Own Fuel, Killing Hurricanes & Weather Control LED Lighting of the Future, Killing Locust Plagues, Pure Opinion and Politics, RFID & Future, Future Robotics, Smart Dust, Future Smart Garages, Future Space Colonies, Flow of All We Know, Future of Motorcycles, Future of IT, Future Personal Tech, Human Animal Debate, Future Truck Tech, Future UAVs, Future Video Game Design, Future VR Future Wind Cars, Future MAVs.

Advanced Weapons Tech, Human Fighter Pilots VS UAVs w/ AI, Future Robotic Net Centric Battlefield, Future Military Air Superiority, Winslow on War; Military Strategy & Philosophy

Absurdity of Human Religion, Biking Across America, Common Sense Psyche 101, Downtown Revitalization, Home Schooling Tips, Honesty in Humanities, How to Become a Writer, Running a Red Ribbon Week Program, Human Psychology of Winning, Hypersonic Humans & Overachievers in Society, Internet Fraud & Freedom in the Balance, Lessons for Forum Users & Bloggers, Motivation, Goal Setting & Success, Online Article Writing, RV Knowledge Primer, Social Issues of Our Time, Flow of Thought, Flow of Transportation, Flow of Water, Science of Common Sense, Power of Presence & Brand Marketing, Winning Strategies for Long-Distance Runners, World Social Issue Solutions.

Change Management and Averting Chaos, Customer Service Brings them Back, Entrepreneurialism for Overachievers, Finite Capacity Models for Service Businesses, Marine Tech, Marketing Magic & Market Share, Non-MBA Management Tips, Over Regulation in America, Sales Management Strategies, Sales Training Tips, Strategic Planning for Entrepreneurial startups, Case for Off-Shoring & Outsourcing, Franchise Business Model.

Alien and Human Law, Cubed Experience, 5u53j Son of Wilson.

Adventures in Advertising, Bonsai & Blitz Marketing, Business Ethics, Direct Marketing Strategies, Online Web Marketing, SB Image & Presentation, SB Networking, (10) Books on "Starting" Sm. Business

Business - Management Ezine Articles

Lance is retired at 40 and running an Online Think Tank while traveling North America. Considering something extremely challenging to exercise his mind and utilize all his experiences, observations and skills. Any ideas?

In the meantime lance is looking for co-authors to help on a few books;

Artificial Intelligence; Possible Futures, Comets & Earth Civilizations, Computer Brain Interfaces, Economics of 21st Century, Franchising the World, Future Auto Tech, Future Aviation Tech, Future Concepts, Future Underwater Tech, Growing Our Own Fuel, Killing Hurricanes & Weather Control LED Lighting of the Future, Killing Locust Plagues, Pure Opinion and Politics, RFID & Future, Future Robotics, Smart Dust, Future Smart Garages, Future Space Colonies, Flow of All We Know, Future of Motorcycles, Future of IT, Future Personal Tech, Human Animal Debate, Future Truck Tech, Future UAVs, Future Video Game Design, Future VR Future Wind Cars, Future MAVs.

Advanced Weapons Tech, Human Fighter Pilots VS UAVs w/ AI, Future Robotic Net Centric Battlefield, Future Military Air Superiority, Winslow on War; Military Strategy & Philosophy

Absurdity of Human Religion, Biking Across America, Common Sense Psyche 101, Downtown Revitalization, Home Schooling Tips, Honesty in Humanities, How to Become a Writer, Running a Red Ribbon Week Program, Human Psychology of Winning, Hypersonic Humans & Overachievers in Society, Internet Fraud & Freedom in the Balance, Lessons for Forum Users & Bloggers, Motivation, Goal Setting & Success, Online Article Writing, RV Knowledge Primer, Social Issues of Our Time, Flow of Thought, Flow of Transportation, Flow of Water, Science of Common Sense, Power of Presence & Brand Marketing, Winning Strategies for Long-Distance Runners, World Social Issue Solutions.

Change Management and Averting Chaos, Customer Service Brings them Back, Entrepreneurialism for Overachievers, Finite Capacity Models for Service Businesses, Marine Tech, Marketing Magic & Market Share, Non-MBA Management Tips, Over Regulation in America, Sales Management Strategies, Sales Training Tips, Strategic Planning for Entrepreneurial startups, Case for Off-Shoring & Outsourcing, Franchise Business Model.

Alien and Human Law, Cubed Experience, 5u53j Son of Wilson.

Adventures in Advertising, Bonsai & Blitz Marketing, Business Ethics, Direct Marketing Strategies, Online Web Marketing, SB Image & Presentation, SB Networking, (10) Books on "Starting" Sm. Business

Inventory Turnaround as MRP and ERP Functions - Inventory Control ...

As it concerns profit margins, inventory control is one of the more visible and appreciable aspects of the manufacturing business today. Raw materials, goods in process, and finished goods are each the visible consequences of inventory in some form or fashion, and each means actual money locked up until product is finally shipped out to the customer. The longer any of these aspects stands idle in the shop, the longer company dollars get tied up in inventory carrying costs. Conversely, the shorter the time inventory stays on-hand, the greater are the enhancements to the bottom-line. What every inventory manager seeks is a rapid throughput and system flow of inventory, especially as a result of the supply chain stream so vital to business today. When inventory moves rapidly through the plant, the benefits in supply chain and inventory management are already being realized. To this end, inventory turnaround means that finished goods are flowing out of the plant and all-important delivery dates are being met.

Inventory turnaround (also termed inventory turnover) is that notion that speaks to the amount of time raw materials and parts spend in the plant after purchase and before they are put to use. Inventory managers seek the fastest turnaround possible, for idle inventory only depreciates in value to the detriment of the company’s bottom line—a wasted cost, so to speak. To enhance inventory turnaround, enterprise resource planning software is developed to integrate all aspects of plant operations to bring real-time data to bear in determining optimum inventory acquisitions/replenishments relative to incoming sales orders and outgoing finished products. Vital to the efficiencies realized in this function of buying-to-the-job is an accurate pull-production scheduling system whereby raw material and/or parts needs are anticipated. Indeed, to provide for just-in-time inventory management and cost savings through economies of scale purchasing, accurate scheduling systems within an enterprise resource planning (ERP) operation allows inventory managers to quickly consolidate purchasing for multiple-jobs that use the same parts.

On the other hand, when raw materials or parts are bought-to-stock for economies of scale, rapid inventory turnaround is bit more problematic and a result of strategic planning. For example, when repetitive production is involved, robust ERP software systems store past purchase histories for material and parts bought-to-stock, and will instantly measure on-hand inventories against anticipated seasonal or otherwise historical inventory needs. This material requirements planning (MRP) involves getting material on hand when needed for production and should address such basic notions as when to place order, how much to order, which vendor to order from, and when the material/parts need to be on hand. A robust ERP software system will provide an easy way to employ MRP programs that schedule and reschedule materials as far into the future as required for repetitive production, and maintain inventory at minimal levels to eliminate waste.

Ultimately, MRP through ERP will create a total inventory management system that is flexible enough to purchase either to-the-job or to-stock. Such flexibility offers the modern manufacturer the ability to take on jobs quickly and without worry for facilitation, and to be able to meet those job delivery requirements consistently and, most importantly, on-time.

http://globalshopsolutions.com/

Dusty Alexander is the President of Global Shop Solutions. Global Shop Solutions is the largest privately held ERP software company in the United States.

Copyright 2007 - Global Shop Solutions. All Rights Reserved Worldwide. Reprint Rights: You may reprint this article as long as you leave all of the links active, do not edit the article in any way, and give the author name credit.

Seven Reasons Why a Hosted Inventory Management Solution Might Be ...

Upgrading. Downtime. Maintenance. Hardware obsolescence. Implementation issues. The litany of headaches related to the implementation and on-going care-and-feeding of enterprise based applications is enough make the savviest of companies want to engage in anything but another software implementation. Like a full-blown IRS audit. Anything…

If your organization is evaluating inventory management systems, consider that a hosted solution inventory management solution may be ideal for your needs if you feel this way. Hosted inventory management solutions such as Invendia eliminate the justified concerns of many companies that another software implementation is the last thing they want to devote resources to - capital, time, talent.

So, the top seven reasons why a hosted inventory management solution might be right for your organization?...

7. Quicker ROI. From an initial ROI perspective, hosted solutions shorten time-to-value by eliminating software implementation and cost issues. You focus on collecting your data, refining your processes, and defining your business goals.

6. Lower total-cost-of-ownership. Users of hosted inventory management solutions need not ever implement software upgrades, pay for maintenance, or add hardware. The net effect is to keep total cost of ownership in check.

5. Increased flexibility. Customers of hosted solutions subscribe for the user license they need today. As their needs change, they add or reduce the users. In this way, they never face the license over-capacity that plagues so many enterprise software deployments. Even more importantly, they increase their flexibility in responding to rapidly changing business conditions.

4. Reduced risk. Any enterprise software implementation takes time. The longer the elapsed time from project kick-off to go-live, the higher the likelihood that the project will lose momentum and management and staff support. Hosted solutions like Invendia do away with many of the preliminary steps of a software implementation (hardware selection, for example), and cause less friction and trauma within the organization. And hosted solutions offer you the advantage of single-source accountability because of the elimination of multiple vendor relationships that would be the norm in a standard enterprise software deployment.

3. Faster deployment. A faster deployment of the software is always a strong positive factor into how well it will be adopted and used by your organization. Hosted solutions typically offer faster deployments, with fewer internal pressures and distractions from day-to-day operations and activities. In short, the focus of the deployment is on end-user training and acceptance, since you won't have to install or maintain servers, networking equipment, security products, or other hardware or software.

2. Easier innovation. Another key advantage of the hosted model is that it facilitates on-going process innovation as new functionality can be introduced incrementally over its lifecycle. The traditional model of purchased and locally implemented software binds companies into "big-bang" versioning where updates are introduced in batches - typically every 12 to 18 months. That model inhibits the real-time improvements of software and processes as they become available. In a hosted environment, major new product releases and improvements can literally be made overnight.

1. Lower cost and smoother cash-flows. Hosted solutions like Invendia have a decided cost advantage over traditional packaged software offerings like SAP and Oracle: low hardware and software costs (you need only outfit your users with PCs, which they likely already have), no depreciation costs, no software or hardware maintenance costs, and lower implementation costs.

With hosted solutions, the first year total cost of ownership can be five to ten times less expensive than enterprise software with the majority of savings resulting from the elimination of upfront integration and customization projects. Thus, the payback period is considerably shortened.

And hosted solutions offer much smoother cash-flows, with no large up-front cash outlays that need be subsumed by your organization.

So, the hosted model of enterprise software lowers risk, simplifies licensing, eases deployment, encourages innovation, and decreases costs, all of which result in faster return on investment, lower total cost of ownership, reduced risk, and the flexibility that you need to successfully compete in today's fast-moving business climate.

Ash Seha is a marketing manager at Invendia, a leading provider of Vendor Managed Inventory (VMI) and Web-based Inventory solutions.

Investing In Logistics And Wholesaling Management

Logistics and Wholesaling Management are considered today of vital importance if one studies closely NAVISTAR and UPS, two well-established companies that have introduced logistics as their main business units.

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Recommend Inventory Management Guide 101 To A Friend.

In business management inventory consists of a list of goods and materials held available in stock. Management of an inventory or Inventory management is all about handling functions related to the tracking and management of material. This includes the monitoring of material moved into and out of stockroom locations and reconciling the inventory balances, setting targets, providing replenishment techniques, reporting actual and projected inventory status. The task of ABC analysis, lot tracking, cycle counting support etc. can even be a part of inventory management.

The primary and foremost step in inventory management is acquiring accurate information for inbound operations. The information so gained in advance can be a crucial factor in improving the inbound productivity. Setting up of an advanced inbound strategy and execution framework can be done without too much of re-engineering effort for the supply chain. The perfect way to commence is to make the best use of information available to you and establish a set of rules and regulations to harness the information efficiently.

In order to better your work and progress further you can conduct a survey by asking supply chain executives to name the five most important area for improvement in operations support systems. The outcome of your survey will reflect better inventory planning as one of the target areas. You must pay special heed to establish an effective way to maintain inventory data integrity or setting up higher productivity and capacity utilization. Lack of efficient inventory data integrity can lead to large amount of non-productive labor, underutilized distribution center capacity and diminished customer service levels due to incomplete or late orders.

From past few years distributors were looking forward for a device that can help them control and manage their largest asset, inventory. As a result several computer software companies have developed comprehensive inventory management modules and systems. These fresh packages enable the distributor to effectively manage his warehouse stock.

Tough the software technique is a beneficial aid yet it cannot provide solutions to inventory management problems. In order for the inventory management system to live upto its potential and perform its best, make sure that you follow quite a few basic and extremely significant ways of good inventory management.

To begin with, ensure that your company is protected against theft. There should be no pilferage problem at your place. While ordering, order only the amount of non-stock or special order items that your customer has approved of. If you wish to add an inventory, you must get a purchase commitment from your customer. Make sure that you assign and use bin sites. Establishment and usage of proper bin sites make order picking a hassle free job in your warehouse. Don’t ever forget to make an entry of the material leaving your warehouse. Try to get rid of the ‘no charge/no paperwork’ material swaps. You should charge the product samples to a salesperson account until they are either returned to stock or charged to the customer.

Effective inventory management also requires paper work (picking documents to be filled by the end of the day, entry of every single stock receipt in computer etc.) that is upto the mark, determination of the most beneficial replenishment strategy for each item in each warehouse, setting up some lucrative offers and awards for the buyers, specifying guidelines for setting the reorder method and setting up of an on-going dead stock and excess inventory control program.

Mansi Aggarwal recommends that you visit Inventory Management for more information.

Building And Maintaining An Inventory Database Can Be A Vital ...

How Inventory Management Software increases Business Efficiency

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Maintenance Management

Maintenance management encompasses and supplies solutions for the planning and control of activities associated with maintenance activities of a plant or facility. Generally, it incorporates labor and materials and may include the management of maintenance stores.

Maintenance Management addresses several competencies and areas of expertise. These are vehicle maintenance, shop operations, environmental issues, inventory management section, benchmarking section and finally, outsource maintenance activities.

The first competency concentrates on vehicle maintenance, including specific maintenance functions, preventive maintenance program implementation and effective administration of warranty programs. This potentially affects all aspects of fleet management including the financial and safe operation of a fleet and the end user’s productivity.

The second competency is shop operations, which review shop practices related to efficiency, staffing levels, and the decision to outsource a shop operation. This process appraises operation to determine optimum staffing levels and advantageous outsourcing opportunities.

The third competency, environmental issues, provides greater comprehension and addresses environmental regulatory affairs and environmentally-responsible fleet/shop operations. Its requirements guarantee not only a clean and healthy environment, but also employee safety.

The inventory management section identifies the importance of effective materials management. It makes use of professionally managed parts to operate at peak efficiency. It is an important contributing element to the progress of maintenance facility.

After that, the benchmarking section offers valuable principles for an in-house fleet maintenance operation. It is a key function to retain productivity and effectively maintain operations. Benchmarking involves proper data collection, comparison, and analysis to determine performance status and standards

And the last competency, which is outsourcing, reviews and understands factors and elements influencing settlements on outsource fleet maintenance activities. Its conclusion depends on a wide array of factors but its ultimate goal is efficiency.

Another element making up maintenance management is its processes. It is inclusive of Preventive Maintenance and Condition Monitoring; Maintenance Planning and Scheduling; Root Cause Analysis and Materials Management.

Preventive maintenance and condition monitoring starts out by creating the implementation plan—identifies measurable success indicators for the condition monitoring and preventive maintenance program. The goal is to achieve a condition monitoring and preventive maintenance program that is documented, executed and tracked. And this may be done through the process of setting up, executing and measuring an effective program.

Maintenance Planning and scheduling is an important element in developing a well functioning maintenance organization. In order for it to work, the organization should do equipment inspections through preventive maintenance, technical database such as bill of materials, work order history, and standard job plans. Advanced methods are also a must in leading the company’s focus on simplifying the planning and scheduling process to make it truly effective.

Root cause analysis, another process of maintenance management, if properly implemented results to the reduction of maintenance planner's work load; decrease in inventory-replenishment purchase orders; deduction of manually-prepared direct purchase requisitions; condensation of maintenance storeroom inventories, while increasing reliability; and generation of new measures for tracking plant reliability.

To complete the maintenance management processes is materials management. This comprises educational maintenance audit and benchmarking tools. Its purpose is, to train and educate the organization in best practices for reliability and maintenance; and to conduct a maintenance audit of the company's reliability and maintenance performance.

Efficiency and effectiveness of maintenance management relies heavily on total comprehension and the ability to address the competencies or areas of expertise involved; and the proper calculation, assembly and conduction of each of its processes.

Ismael D. Tabije is the Publisher-Editor of http://www.BestManagementArticles.com, a unique niche-topic article directory that features exclusively business and management topics. For a large dose of business degree online tips, ideas and strategies, see http://maintenance-management.bestmanagementarticles.com .

Warehouse Management Software

Managing a warehouse is not necessarily a very easy task. To be highly successful in this dynamic and exciting market and business environment, it is very crucial to evaluate each and every function of the business. The company must arm itself with state-of-the-art warehouse management systems. The warehouse management system must quickly and cost-effectively integrate the functionality required to solve the challenges of the business, with the ability to adapt to changing requirements and technologies. The warehouse management systems help in various aspects like picking, packing, receiving, shipping, inventory control and audits.

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Sales Success Is Not About Increasing Sales

Sounds crazy doesn't it? But, remember the emerging role of the sales professional today is not to increase sales. Let me repeat that- The sales person's role today is not to increase sales. The role of a sales professional today is to systematically and consistently increase the number of customers who choose you to be their #1 supplier... You must become-THE SUPPLIER OF CHOICE- which means you always get-THE FIRST CALL-and THE LAST LOOK! Don't make the rookie mistake of thinking that your customers don't give last looks. If your customer doesn't give you last look. That means somebody else is getting it. It's time to evaluate the relationship equity you have built in that account.

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Inventory Management Software

Effective management of finished product inventory is quite essential for running a business efficiently and profitably. Inventory strategies and decisions become particularly important in businesses where inventory costs form a sizeable part of total marketing costs.

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Inventory Asset Management Software

Of the many advantages of using effective inventory asset management software, perhaps the most important is how it prevents over- or under-stocking. Inventory software churns out projections based on order history, so you can prepare for peak seasons and lessen stock during dips. This prevents a company from investing in assets that will reap no eventual rewards. Plan ahead for stock requirements and accurately gauge combined net stock requirements with a click of a button.

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World's Best Practice Inventory Management

In almost every endeavour it is difficult to determine what constitutes ‘best practice’. Businesses around the world spend millions of dollars on software and advisory services and often don’t know whether they are ‘best practice’ or just somewhere in the pack.

Many companies will say, ‘why does it matter just as long as you keep getting better?’ The stark reality is that inventory requires the investment of cash. The items need to be purchased and stored and this ties up cash. This working capital can be a significant burden for many companies and if freed up can provide significant cash resources that can be used for other more productive purposes.

For many companies the key issue is availability and so long as they have an item when it is required they care little about the cash investment. However, this approach will not maximise your ROI and, in almost all cases, cannot be financially justified on any level. This is because the excess inventory investment that this approach generates provides little or no value to your business. The excess is invested in inventory that does not move or becomes obsolete.

World’s best practice inventory management demands that the ‘management system’ is optimised not just the inventory. It is in this field that best practice can be both easily identified and readily achieved.

Each level on the ladder to world’s best practice provides a greater degree of control and management but is only at Level 5 – System Optimization that the management system is optimised. By reaching this level companies can reduce their inventory investment, freeing up cash, AND achieve their desired availability levels.

The five levels to world’s best practice inventory management are:

Level 1 – Ad Hoc: Purchases are made on an ‘as needed’ basis. At this level there is little control necessary as inventory is expensed when purchased and used immediately. While this may seem to reduce the cash investment it may not reduce the total cash expenditure. This approach can only be viable if the items are available ‘instantly’ and the cost of a ‘stock out’ is negligible.

Level 2 – Storage: Inventory is expensed when purchased and stored for use but not strictly controlled. Similar to above except that items are stored because of the cost of a stock out. This approach appears to solve one problem but it raises two others. Firstly, total expenditure is likely to increase as items are purchased in ‘economic quantities’. (See my free e-book ‘5 Myths of Inventory Reduction’) Secondly, without controls there is little opportunity for review and development.

Level 3 – Capitalisation: Inventory is capitalised and subject to some level of control, either manual or software based. This approach is by far the most popular as it appears to provide the required mix of availability and control. Unfortunately, most organizations use their software solely for counting and accounting. There is a strong reliance on human calculation of inventory requirements but often little review of outcomes. The result is likely to be good availability but a significant over investment in inventory and high levels of obsolescence.

Level 4 – Software Optimisation: Inventory is capitalised and stock levels are optimised based on a risk/return algorithm. This is the basis of most software solutions. Most software packages will incorporate the ability to automatically adjust the required stock levels based on the history of demand and supply. Very few companies actually use this feature because they know that they cannot trust the results. This is not due to a software flaw but because the supply and demand may not represent typical usage. (This is explained further in the book Smart Inventory Solutions.)

Level 5 - System Optimisation: Inventory management minimises the overall cash investment without an increase in risk. This is world’s best practice. At this level, all of the factors that influence the actual inventory investment are reviewed on a regular basis. This review is manageable because it is limited to the ‘vital few’ items that have a real impact on the level of investment. Inventory levels are adjusted to take account of changing needs and this minimizes the likelihood of obsolete inventory.

Any company that already has the software required for Level 3 can achieve Level 5 – world’s best practice. What is needed is the know how, policy development, measures and reporting required to take a company to Level 5, not more software. Once these key issues are addressed you are implementing a true management system. Software only goes to level 4, it is the management system that provides the bridge to Level 5.

For more information visit http://www.InitiateAction.com

About The Author

Phillip Slater is the author of the book Smart Inventory Solutions and the developer of the Inventory Cash ReleaseTM System - ICRTM06, a world’s best practice approach to inventory management and reduction.

For more information visit his website at http://www.InitiateAction.com.

Why Your Current Approach To Inventory Management Is Not Good ...

Businesses around the world spend millions of dollars on software and inventory management systems in an effort to maximise their return on investment (ROI) from inventory. Until now even the most sophisticated of these systems left businesses way short of best practice. In fact most of these systems institutionalise excess inventory.

The problem is that most software relies on optimisation and this limits the opportunity to reduce inventory because it ignores external influences. Software can only optimise the values it has, not what could be.

World's best practice inventory management demands that the ‘management system’ is optimised not just the inventory. Most inventory software takes today’s data and runs an algorithm to optimise holdings. What they miss are the changes in the management system that could further reduce the total level of investment. This flaw makes software systems self-limiting in their results.

Inventory management is much more than just the software system. Inventory management is the combination of know-how, process, measures and reporting that together provide the opportunity for maximizing availability while minimizing cash investment.

The five reasons why your inventory management is not best practice and is costing you money are:

1. The Responsibilities Are Misaligned

The people that make the day-to-day decisions will typically not be responsible for the working capital outcomes; they will be responsible for availability. The problem is that if you run out of stock all hell breaks loose but if you overstock there is no repercussion. This is especially the case with indirect inventory that is not subject to the usual planning scrutiny. Given this, what do you think most people do? That’s right, they over stock!

2. The Optimization Is Incomplete

Sophisticated software can track all sorts of data and in many cases the software can make optimization decisions based on that data. This can reduce your inventory but it is self-limiting. The problem is that software optimizes only on known data and ignores process and behavioural changes that can impact that data. This is software optimization not system optimization. The software should only be a tool within a bigger process of optimization.

3. It Is Managed Reactively

Inventory is often seen as ‘set and forget’, that is, once the item is optimized for the current situation the requirements are not systematically revisited. It is often only when there is a ‘cash crunch’ or some other emergency that action is taken. Yet, even indirect inventory can represent millions of dollars of investment and deserves frequent attention. When action is taken it usually addresses the highly visible items rather than the real ‘cash burners’.

4. There Is A Significant Time Lapse Before Problems Emerge

The number one question asked about inventory is ‘what do I do with slow moving or obsolete stock?’ Depending upon the accounting policies in your company this stock has taken 3–5 years to reach the point where that question is asked. By this time it often seems irrelevant to revisit the original decision or processes that produced this result. No one would accept this approach to quality management! No one ever asks ‘how do I prevent the accumulation of slow moving or obsolete stock?’

5. It Is Painful To Fix And Easy To Ignore

In most cases the removal of obsolete inventory will result in a ‘hit’ to the profit and loss account. However, if a reason can be found to justify it for another year then few will argue. Eventually someone is going to have to make a decision and it will be painful. For this reason, obsolete inventory decisions are often driven by the opportunism of results reporting rather than good management principles.

To truly achieve best practice your organisation must review these issues and develop systems that will minimize their impact or eliminate them altogether.

Phillip Slater is the author of the book Smart Inventory Solutions and the developer of the Inventory Cash ReleaseTM System - ICRTM06, a world’s best practice approach to inventory management and reduction.

For more information visit his website at http://www.InitiateAction.com

Inventory Management - One Size Does Not Fit All

If there is one great myth in inventory management it is that one single technique will solve all inventory problems. Not that people believe that one technique will solve all problems in all situations but that in any given company one approach is all that is required to manage all inventory.

For the inventory manager this is very attractive as it means that there is only one approach to manage. For the software vendor, consultant or advisor it means only one solution to sell.

There is a wide range of techniques and approaches that people use to manage inventory. These include JIT, MRP, DRP, SCM, Risk Management, safety stock and EOQ’s Sometimes they are used on a stand alone basis and sometimes in conjunction with each other. All are worthwhile techniques when used appropriately.

Problems arise however when the approach to identifying the appropriate solution starts by looking at the solution rather than the inventory. This approach starts from the assumption that because solution x works at company y it must be good. Or because the software suits our enterprise wide planning system it is appropriate. In fact it is often assumed that inventory software packages are much of a muchness. Have you ever heard someone say ‘and it has an inventory module’!

The fact is that not all inventory is the same and consequently not all inventory requires the same approach to management. Without trying to be exhaustive it is easy to identify that some inventory is made to order, some is made to stock, some is perishable, some have characteristics that change with time, some are part of assemblies and sub-assemblies and some are stand alone items. These, and many other variables, lead to a huge number of different requirements for inventory management.

While the differences between inventories in different industries are well documented (for example, the requirements for managing inventory at a large retailer will be different to managing in-process inventory at a petro-chemical plant) what is not widely recognised is that the requirements for inventory management across a single business can vary significantly.

The single biggest error made in inventory management today is to select an inventory management technique and apply it universally across a business. The ‘one size fits all’ approach can lead to significant inefficiencies in the results of inventory management. This might not be an ‘out of stock’ as that situation is always dealt with urgently. More likely the result will be the holding of excess inventory and tying up valuable funds unnecessarily.

A better approach to inventory management is to start by looking at the inventory rather than the solution and identifying the characteristics of each type of inventory being held. When this is done, an approach that is appropriate to the demand, supply and cost characteristics of the inventory can be selected and the inventory holding optimized for its characteristics.

Consider a manufacturer that has a total inventory made up from raw materials, work in progress, finished goods, a distribution network and engineering spares. Applying a universal mindset or solution across all of these inventory types is unlikely to deliver an optimal result. For example, dealings involving suppliers (as for raw materials and engineering spares) provide a different range of opportunities compared to internal supply situations (WIP) and even finished goods. The ability to forecast, the ability to control the supply chain, the ability to source on consignment, the requirements for buffer stock, the impact of a stock out all vary. Unless you allow the flexibility to pursue opportunities related to different inventory types your business is likely to be over investing in inventory.

Inventory management is about more than just logistics and getting the right thing in the right place at the right time. It is also about the efficient and effective use of capital. Taking a singular approach to managing all types of inventory without fully considering the different characteristics and opportunities of that inventory leads to overstocking and obsolescence and the waste of capital resources that might be better directed elsewhere.

Phillip Slater is the author of the book Smart Inventory Solutions and the developer of the Inventory Cash ReleaseTM System - ICR®06, a world’s best practice approach to inventory management and reduction.

For more information visit his website at http://www.InitiateAction.com

Better Practice Inventory Management

People are always searching for ‘best practice’, somehow believing that there is a silver bullet solution that will cure their inventory problems. The problem, of course, is that what is best practice in one country/industry/business might not be best practice in another. In any case, the exalted ‘best’ practice might just be too much of a jump for many people to take or indeed may not be economically viable.

Interestingly, though, in my work, the question that I am most often asked is, ‘what do I do with all of this excess inventory?’ My answer, of course, depends upon the nature of that inventory, what it is, how old it is etc. But obviously the best thing to do is create less of the inventory in the first place!

Some might think that this requires best practice and is therefore difficult to achieve but I would argue that this really is more achievable than people think. Putting in place the right processes, polices, measures and reporting in order to limit inventory purchases to those items that are most likely to be used/sold and in the right quantity, is as important or perhaps a more important task than clearing out the old stock. This can be achieved by understanding what works well for others rather than what is best practice. I think of this as better practice.

With that in mind I recently had the opportunity to interview more than 30 people, across a dozen companies, in all Australian states and New Zealand, who were all associated with inventory creation in one way or another. There were General Managers who make the occasional big decisions that create inventory. There were inventory managers who take the day-to-day actions. There were purchasing people who order the stuff and sales people who provide forecasts. Each of these people has a role to play in the creation of inventory but interestingly only the inventory managers acknowledged that role explicitly. The result of those interviews does not constitute best practice but I think that they give some insight into better practices.

These interviews were conducted on behalf of a client so I am unable to give you all of the detail or the quantitative results. But I do have permission to tell you what we deduced in a qualitative fashion.

During the interviews we identified the following similar practices that were consistent between the companies that performed well.

1. Inventory decisions (range and quantity) were made at a local level. The locals were considered best placed to understand local conditions and requirements and therefore better able to get the inventory mix right. They had a better handle on forecasting because they were closer to the customer or demand. Centralized systems often missed the subtle changes or inside knowledge that helped stop the ordering of items (for example) when usage had changed but had not yet been flagged in the system.
2. Requisition systems were used to order items through centralized purchasing. This approach creates efficiencies in procurement and provides greater control over terms of business and logistics. The purchasing people were concerned with all the purchasing issues not just the availability.
3. Inventory items and codes were created centrally. This was used as a means of controlling the SKU count. Companies that did not do this experienced the ‘death by a thousand cuts’ associated with managing a long tail of low value SKUs
4. The better companies had moved to central ordering after trying local ordering. They found that this change had a positive impact on their inventory investment. The point is that they tried it one way and made a change and that this experience was consistent.
5. Inventory management systems and practices were standardized. Each location or department followed exactly the same process. They used the same rules for determining what they should and shouldn’t buy and had the same authorities, responsibilities and accountabilities at similar levels. Kind of like McDonald’s only not involving hamburgers! This didn’t remove individual decision making or initiative it just meant that the rules were consistent.
6. Most of the better companies had an inventory process ‘champion’ to work on continuos improvement and maintaining standardization. This person did not manage the inventory or ‘own’ it any way. This person ‘owned’ the process. I liken this to having a Quality Manager; they don’t own the production just the process used to control quality. This was not necessarily a full time role
7. Inventory was reported at a local level using local balance sheets. Local reporting and highlighting of inventory was seen as an important way to create visibility and therefore ownership.
8. The better companies were quite aggressive in inventory management, setting and achieving aggressive targets rather than ‘achievable’ targets. The better companies did not just want to manage availability they saw managing the cash investment as equally important and therefore set targets aimed at minimizing the cash investment without jeopardizing availability.
9. Internal interest charges were included in departmental P&L reports as a means of providing immediate feedback on the impact of additional inventory (these items were reversed before any corporate reporting). This helped make the cash investment important at the senior levels that had to report on their P&L Statement on a monthly basis. Companies that didn’t do this found that reporting a good profit was used to justify an over investment in inventory (that is an investment that did not really contribute to the profit). This approach forced them to mange both cash and profits.
10. Slow stock was identified at a higher stock turn level in the aggressive companies than it was in the others. This was seen as a way of highlighting the approaching ‘cliff’ of obsolescence and was used as a way to force action before accounting rules required items to commenced being written down.
11. Virtual warehousing was used to separate stock purchased for different purposes. This is where a different warehouse code might be used although the material was in the same warehouse as other stock. This was particularly useful when stock was bought in especially for one off projects or events such as capital works or shutdowns. This approach enabled a heightened level of visibility of who had bought what and prevented mistakes being hidden in the general inventory.

Obviously the sample for this survey was small so the results are open to interpretation. However, the actions listed are not so radical that they cannot be implemented by almost everyone that is seeking ways to improve their inventory management. The 11 actions listed above were consistent across a number of the companies that were ‘doing well’ and were noticeably absent in the others.

So, assuming that you want to improve your inventory results the only thing stopping you from adopting some or all of these actions is the fear of either change or loss of control. Of course you could just keep looking for ‘best practice’ but now that can only be seen as an excuse to do nothing!

Phillip Slater is the author of the book Smart Inventory Solutions and the developer of the Inventory Cash ReleaseTM System - ICR®06, a world’s best practice approach to inventory management and reduction.

For more information visit his website at http://www.InitiateAction.com

Small Business Inventory Management Software

The success of a small business depends on the proper management of its resources. Studies indicate that most small businesses fail. A major reason for the failure is poor recordkeeping practices, which results in frequent occurrences of stock depletion, careless invoicing and subsequent loss of customers and business. This kind of failure can be avoided by proper inventory management.

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Inventory Management

Inventory Management when implemented correctly, saves your company time and money! Keep track of your company's products and materials and know not only exactly what you have, but exactly where it is, how old it is, how much you paid for it, where it came from, where it is going and more.

Inventory Management is an ongoing process of keeping track of everything needed to run your operation and keep it running. Proper Inventory Management will keep your business flowing from the time an order is placed right down to the point your product gets into your customer's hands. Track your materials, your products during manufacturing, your ready to ship products, and your products in transit and on store shelves.

With today's technology this can be accomplished right from your desk! No need to go out and count everything anymore! Today we have bar code scanners to read labels on boxes of supplies and finished products. We have RFID Tags to track our products, shipments, supplies, orders in transit and more. This new technology allows us to even know where the final product ends up right down to the street and house number where the final user resides!

RFID is playing a bigger and bigger part in today's Inventory Management. From drug stores, retail outlets, libraries, and even credit cards to name a few, this RFID technology will soon be used to track people with their diver's licenses! RFID Tags are found in almost every product already and more products every day are using RFID Tags and RFID Readers. These RFID Readers are hooked up to Inventory Management Software that allows the user to track it during every step of the manufacturing process and depending on the method of delivery, tracks it to the end user.

Today's Supply Chain Inventory Management Software is just incredible with everything it can do! What i huge time saver and asset for businesses. Microsoft is even getting in on it with their Great Plains Inventory Management Division. They strive to give companies the best possible Inventory Control along with real time Inventory Information. This helps to reduce the cost of doing business and saves companies time and money. The Inventory Management Software in use today does several important things. It prepares invoices, keeps an up to date database of your clients, automatically reorders stock (if desired), maintains the balances of your inventory and many more crucial time saving functions.

This article was written by Kriss Standke who is an accomplished Webmaster and publisher of Inventory Management Today, Engineering Today, as well as Warehouse Spot where he provides detailed and informative articles, tips, and advice on Inventory Management along with other great Manufacturing and Storage Information.

Lean Manufacturing and the ERP Inventory Management Software Solution

Since the introduction of the lean system of continuous improvement manufacturing (CI), the desire has always been for inventory management that minimizes stock on hand, if not fully eliminating it. True to lean principals, by eliminating waste at every turn in the manufacturing process quality is improved while production time and costs are reduced. As one of the “seven wastes” in lean philosophy, inventory proves to be inefficient when a plant maintains more on-hand inventory than is minimally required to produce products in the immediate time frame. Rather than the batched, push-production system where large inventories are maintained for the potential of future sales or supply chain problems, lean methods employ a pull-production system where orders are pulled from customers and raw material as inventory is maintained only long enough to be swept into production—just in time (JIT), so to speak.

Certainly, manufacturers today are seeking to be more productive and less wasteful with regards to inventory management. For example, there is a train of thought that by decreasing randomness in the manufacturing process, you also decrease inventory. From this thinking has emerged the notion of total enterprise resource planning (ERP). Here concepts such as system flow, quality of performance, labor productivity, purchasing and materials management, inventory, and shipping are all integrated in terms of procedure and communication. With the real-time data available through ERP software, plant departments are integrated and coordinated toward the goal of decreasing randomness in the production process.

With a robust ERP software package, lean inventory management is facilitated in all aspects of the operation and should include the important functions of: cycle counting, supply & demand, and turnaround/turnover. In essence, it is this sort of inventory management and efficiency tool that is at the heart of the building and utilization of successful CI systems today.

For example, in the cycle counting mode, inventory managers can run inventory audit lists tagged to any period of time to answer the question of why there are discrepancies in inventory numbers. As for turnaround/turnover, ERP inventory management software is suited as an assessment tool for gauging how JIT any manufacturing system really is through the number of turns the inventory takes; and of course, increased turns is the desired result of a lean system eliminating waste by the reduction of on-hand inventory.

Regarding supply and demand chains, inventory management through ERP software is able to review key time-critical data to balance the time phasing requirements of materials, parts, and tools. That is to say, with a robust ERP manufacturing solution, inventory managers are in the position to make informed decisions concerning demand chains and supply chains. This is especially true in the newly emerging vendor managed inventory systems (VMI) that are increasingly seen as the logical extension of lean manufacturing methods and JIT inventory management.

These aspects of inventory management are vital elements for inclusion into any robust ERP software package seeking the leaning of manufacturer operations. With the knowledge gained through the real-time data available in ERP, inventory management becomes a central point of analysis for finding additional efficiencies in the system flow. It is in this way that efficiencies in manufacturing eliminate waste in the process. By offering the user a complete inventory management package that interconnects with all other shop areas in the production process, integrated ERP software builds a CI environment that enhances both productivity and profits.

http://www.globalshopsolutions.com/optimized/erp-software/erp-materials-management.asp

Dusty Alexander is the President of Global Shop Solutions. Global Shop Solutions is the largest privately held ERP software company in the United States.

Copyright 2007 - Global Shop Solutions. All Rights Reserved Worldwide. Reprint Rights: You may reprint this article as long as you leave all of the links active, do not edit the article in any way, and give the author name credit.

Use Jewelry Software to Control Inventory

To predict the demand for jewelry items in the future, you must have knowledge of product performance of the past. And that is one of the important functions of a well-designed jewelry software program.

Of course, no matter how well designed, a jewelry software program cannot totally eliminate intuition and luck. But having a well-organized and accurate history of sales provided through jewelry software reports, will take much of the guesswork out of inventory management.

A jewelry software program will help you look at a number of forecasting factors such as product history and the expected demand. The reports generated by your program should give you an in-depth analysis of numbers, both for historical sales and ongoing sales curves. At the very minimum, you should be able to rely on your jewelry software reports for 60% of your forecasting decisions with 20% based on experience and 20% on intuition.

Naturally, the more you become familiar with your jewelry software, the more reliable your inventory planning will become. You will never obtain 100% accuracy but 90% is an achievable goal.


Don’t be timid about customizing your jewelry software

Jewelry software programs are customizable. So after purchasing a good jewelry software program, it will probably need some tweaking. For example, every jewelry store has its own forecasting process to suit its particular needs. Therefore in order to be successful, the program must work for you...not you for the program. So don’t hesitate to adjust the jewelry software program to fit your exact needs.

You will probably find customizing easy with any of the top jewelry software programs now on the market. Not only do the developers want you to customize their software but will help you do so. A well-written and easily understood manual is a must for this activity. Lastly, a good customer support program should back the software.


Use your jewelry software program every day

Inventory management should never be a once a month or once a week activity. You should be looking at the figures generated by your jewelry software program every day. This will help you develop a more accurate understanding of your daily business flow, be able to quickly spot the need for inventory adjustments and greatly increase your forecasting accuracy.

Remember, a well-designed jewelry software program is the first step toward reducing overstocks and preventing out-of-stocks. You will find it to be one of the best inventory tools available for the successful operation of a jewelry store.

Cheree Dohmann is an internet marketing consultant that works with individual companies to build branding, search engine visibility and create online advertising opportunity for small businesses. Cheree has worked with IBIS for the past 2 years to promote their jewelry software. To learn more about IBIS, please visit http://www.ibis-net.com.

Top Ten Business Uses of the 80 - 20 Principle

The 80/20 Principle can be used in almost any area of function to direct strategic and financial improvement. However, Richard Koch in his book-The 80/20 Principle, list ten top business uses that he believes has the most potential for improvement.

Strategy

Using the 80/20 profit analysis, determine a segment strategy by dividing your business up into as many categories as are relevant to your business. Compare the profit and loss of each segment to find the 20 percent that are accounting for 80 percent of the profits and the 20 percent that are accounting for 80 percent of the losses. Redirect your efforts to the areas where you can gain the most benefit. Reduce your efforts in the areas where you are having the most losses.

Quality

Using the 80/20 principle to focus your efforts on the least 20 percent causing most of the problems, instead of trying to tackle all the problems at once. As the least 20 percent that are causing the most problems become resolved, reevaluate your list again and start over.

Cost reduction and service improvement

Simple is cheaper and better, make the simplest 20 percent of your products as high quality and consistent as possible. If something is complex, simplify it or eliminate it.

Marketing

Identify your core 20 percent of your best customers and do everything possible to keep them. Provide exceptional and outrageous service to them even if it has a short-term cost, the payback later will be worth it.

Selling

Have all of sales focus on the core 20 percent of customers in their business line. Resort to less expensive phone or mail support for the remaining 80 percent. The core 20 percent are the customers that are providing you with 80 percent of your business profits. Reward you best sales people and hire more with the same personality and attitude.

Information technology

Computer programs become more efficient when 80 percent of the processing time is used on 20 percent of the need. This results in functions that are used the most often, being faster and easer to use. Most advances in the last 50 years have been due to the 80/20 principle being applied to technology. There is no end to the refining processes that use of the 80/20 principle will bring to businesses relating to information technology.

Decision making and analysis

Since 1950, business has increasingly been blessed, or if you prefer plagued, by management, scientists, and analytical managers. Analysis has probably been the greatest U.S. growth industry in the past half-century, and instrumental in some of the greatest U.S. triumphs. But analysis has had its darker side: the escalation of corporate staffs that are only now being properly dismantled. The 80/20 Principle is analytical but puts analysis in its place.

Five rules for decision making:

Rule one. Not many decisions are very important. Only one in twenty will be important.

Rule two. The most important decisions are often those made only by default.

Rule three. Gather 80 percent of the data and perform 80 percent of the relevant analyzes in the first 20 percent of the time available. Then make a decision 100 percent of the time and act decisively as if you were 100 percent confident that the decision is right.

Rule four. If what you have decided isn't working, change your mind early rather than late.

Rule five. When something is working well, double and redouble your bets.

Inventory management

Stock almost invariably follows some sort of 80/20 distribution, around 80 percent of stock only accounts for 20 percent of volume or revenues.

Point one. Cut down radically on your unprofitable product.

Point two. Try to export the problem and cost of inventory management to other parts of the value-added chain, to your suppliers or to your customers. The ideal solution is for your stock never to come near your facilities.

Point three. If you must hold a certain amount of stock, there are many tactical ways to use the 80/20 Principle to cut costs and speed up picking and packing.

A word of caution, in repair related business, make sure that you are not hurting your business by cutting your part's department of parts needed for repairs. Use the 80/20 Principles to better manage these stocks. Stock higher assembles in place of hundreds of smaller parts.

Project management

Management structures are being exposed as inadequate and worse. Many of the most energetic people in business, from chief executives down, do not really have a job. Rather, they pursue a number of projects.

Project management is an odd task. On the on hand, a project involves a team. It is a cooperative and not a hierarchical arrangement. But on the other hand, the team members usually do not know fully what to do, because the project requires innovation. The art of the project manager is to focus all team members on the few things that really matter.

Simplify the objective, 80 percent of the value of any project will come from 20 percent of its activities, the other 80 percent of the activities will arise because of needless complexity. Impose an impossible time scale, this will ensure that the project team does only the really high-value task, the 20 percent that will deliver 80 percent of the benefit.

Plan before you act, write down all the critical issues that you are trying to resolve. Decide who is to do what and when. Re-plan after short intervals.

Negotiation

The 80/20 Principle adds just two points to the study subject of negotiation. 20 percent or fewer of the points at issue will comprise over 80 percent of the value of the disputed territory. Build up a long list of spurious concerns and requirements early in a negotiation, making them seem as important to you as possible. These points must, however, e inherently unreasonable, or at least incapable of concession by the other party without real hurt (otherwise they will gain credit for being flexible and conceding the points). Then in the closing stages of the negotiation, you can concede the points that are unimportant to you in exchange for more than a fair share of the really important points.

Second, don't peak too early, wait until the deadline looms. 80 percent of the concessions will occur in the last 20 percent of the time available.

Impatient people don't make good negotiators.

Suggested reading: The 80/20 Principle, by Richard Koch, ISBN 0-385-49174-3

About the Author: Hubert Crowell, Cave Explorer

After working in service for 23 years with Eastman Kodak Company as a service person, technical support and training specialist, followed by another 13 years working for other companies in the service field, I have decided to share my ideals on improving the service department. I would like to thank Jack Ingram, my supervisor at Eastman Kodak Company for the encouragement and guidance until his retirement. I would also like to thank Barco Projection Systems and all the great employees that worked with me for the last seven years before I retired.

For complete paper on The Service Department, Please visit my web site at: http://hucosystems.com/

I have started writing as a hobby and plan to write about my life, work, hobbies, religion and many other things of interest to me and maybe others will enjoy also.

For a complete viewing of my articles with photos please visit my article web page at:

http://hubertcrowell.name/

Manage Your Inventory by Using Inventory Management Software

If you have a company that handles large amounts of inventory you’re going to want to have a system in place that lets you manage your inventory in a way that you always know exactly what you have on hand, what has been sold and spoken for, and what stock you have arriving. Managing the fulfillment of your orders is very important so that you don’t run out of inventory. Running out of inventory can mean losing sales and this is a scenario that you want to avoid. Inventory management can be made easy with the use of inventory software that is available to do all the work for you. No more papers lying around waiting to be filed.

Inventory software is easy to use and will most times come with a tutorial to help you get started. You’ll be able to keep track of the inventory that pertains to your business without ever having to second guess yourself again. As well as an accurate record of what inventory you have on hand you’ll also be able to keep track of your costs, expenses, and debts. Most inventory management will also let you keep track of the equipment that you have that is used as your business capital. If you have any equipment that is depreciated you’ll be able to tell at a glance what the value is. With all the functionality of an inventory software program you may be able to reduce those other types of business software that you’re using to keep records and information about other aspects of your business.

There are many different types of inventory software on the market. If you’re unsure about what management system to buy you can check reviews of software in many business magazines and journals. Many software companies will offer their software with a trial version so you can use they program for a couple of weeks or will give you an extensive online overview of their product before you decide to buy.

James Hunt has spent 15 years as a professional writer and researcher covering stories that cover a whole spectrum of interest. Read more at http://www.inventory-management-center.com

The 5 Phases of Selling - Part 1

Making contact with a new customer is much like starting a car. And if you sell new methods or processes, or new technologies, or new ways of doing things - moving too fast stalls the process. Even if you are not selling anything new, you still need to follow these steps to ensure success, and to save yourself a lot of time and stress.

These are the steps for a successful B2B sale.

Phase One: The customer must agree with you that he has a problem. If for example, you sell inventory management software; your customer must acknowledge that he's got an inventory management problem.

For most sales people, this is the most difficult step in the process. Almost all sales people, who are looking for new prospects, spend most of their time in phase one. However, instead of asking what the problem is, these sales people try to sell a solution first, by trying to tell the prospect what business they are in. They then leave it up to the prospect to figure out if they need their help or not. This is not only the wrong approach. This is also a terrible waste of a salesperson's time!

Let's look at the process here for a minute. The sales person receives, or builds, a list of prospects to call. Many have had no training on how to approach a prospective customer. Most have been taught by the "Stuff against the wall method". This method stated that the more calls you make, the more sales you will make. This outdated and incorrect methodology has been used for too long. It was a method invented by uninformed sales people who didn't know any other way of calling prospects.

So, they pick up the phone and start calling. Most sales people are terrified of this process. They know that over 95% of the people they call will not be receptive or hospitable to their call. The sales call will receive rejection, and most of these sales will people take it personally. I know, I've been there, done that!

We need to educate sales people on what they should be doing when they first approach a prospect. Many companies do not know how to do this properly. This is a subject for another time. But, if your sales people are struggling with this exercise, then do not blame them. Get them the proper training and coaching on how to perform this important part of the selling process.

In actual fact, phase one is a marketing issue, not a sales issue. It is marketing's responsibility to build leads. Depending on the size of your organization, you need to ensure that marketing and sales work together, to make this the driving force behind your revenue generation machine.

Now let's have a look and see what you need to do as you move into phase two.

Phase Two: The customer agrees that there is a problem. Now, he has to agree that he "wants to solve" his problem. This can be a very difficult phase to overcome. However, again, this should be a marketing issue, not a sales issue.

You have to convince the prospect that he will only gain by solving his problem. As you know, some people realize there is a problem, but they believe the solution will be more hassle to them than the problem.

As an example, a controller knows that budgeting software will help him in his budgeting process. He also knows that he will have to train all of his staff on the software, and more importantly, how to do their job differently. In the short term, it will be very disruptive to the whole organization, and he does not want to get involved. He has heard the horror stories from friends in other companies.

You need to show him that you are interested in solving his problem, and that if he doesn't solve his problem, he will be much worse off than he is now. You do not want to make the mistake of trying to sell him something in this phase of the selling process.

What you have to do here is show the prospect that you are knowledgeable about the problem. You can best demonstrate this knowledge in two fashions. An excellent way to show your expertise in this area is through a white paper, a newsletter, or a technical review you or your company has written.

If you (your company) have a white paper describing how to fix this problem through sound business practices, you will start to build trust with the prospect. Remember that someone will not buy from you if you have not developed a certain degree of trust with him or her.

They want to know that they are buying from someone reputable. The best way to demonstrate your reputation is through your knowledge of your prospect's business, and consequently the problems they have been experiencing.

The other, and better, way to show him that you can solve his problem, with the minimum amount of disruption to his business, is by a referral or through references. In fact, referral selling is the best way to sell.

Phases three to five will appear next time in "The 5 Phases of Selling - Part 2."

You already know that the B2B sales cycle can be anywhere from 2 months to 9 months. What if you could cut that time in half? Discover how you can do just that and at the same time stop chasing non-productive leads.

My name is Ian Dainty and I have written a book entitled "A Fast Track to Success in B2B Sales". Visit my web site at http://www.hitechsalescoach.com/ and get your copy now. You can also contact me at ian@hitechsalescoach.com at any time for any questions you have about selling and marketing. I look forward to working with you to help increase your income.

Inventory Asset Management Software

Of the many advantages of using effective inventory asset management software, perhaps the most important is how it prevents over- or under-stocking. Inventory software churns out projections based on order history, so you can prepare for peak seasons and lessen stock during dips. This prevents a company from investing in assets that will reap no eventual rewards. Plan ahead for stock requirements and accurately gauge combined net stock requirements with a click of a button.

Inventory asset management software can also help you streamline your warehouse procedures. You can integrate ordering with cross docking to save time and energy. You can also speed up stock turnover with the software’s real time processing. Moreover, inventory asset management software can help you develop a distribution planning system by simulating purchase patterns and other indicators, so you can take your business to new heights.

The ability to give immediate customer support is another obvious benefits of using inventory asset management software. When you know how much you have and when to deliver more, you can give customers reliable timeframes and commit to contracts more intelligently.

If you are serious about improving your inventory management systems, then you need software that supports production and assembly procedures. Some inventory software business packages have built-in material and capacity planning functions to prop up assembly line processes. You should also choose software that is expandable to handle unique projects. It should allow you to create and maintain customized project tracking and development structures for special or one-time ventures while integrating data to your current processes.

Asset Management Software provides detailed information on Asset Management Software, Digital Asset Management Software, Inventory Asset Management Software, Fixed Asset Management Software and more. Asset Management Software is affiliated with Free Project Management Software.