For any company that manufactures, distributes, or sells products of any kind, inventory management is always a key concern. Inventory management can have different facets depending on the industry, too—companies might have to consider raw materials, production lead times, shipping times, and dozens of other factors that affect their ability to deliver goods to their customers.
What’s more, considerations and constraints can vary widely by country or even by region, since every area has its own conditions and business practices. Companies doing business in different places need to be familiar with those differences and learn how to work with them if they want to succeed. After all, the old adage “when in Rome, do as the Romans do” is still true today.
Different countries, different conditions
Inventory management can be complex enough in our own country. Yet to do business abroad, we need to understand other countries and their practices. MBI Global operates in a number of places around the world, including South America. One of those South American offices is located in Lima, Peru. Working internationally means that many considerations come into play. For instance, with inventory management, we need to study and fine-tune it to meet the needs of a different customer base.
Good methods, good results
To keep our supply system running smoothly, a high level of organization based on reliable data is a must. It’s important to put an entire system in place to plan stocks for the next six months or even the coming year.
The COVID-19 pandemic has further complicated that task by extending all of our carefully planned timelines. We need to give everything more time to account for slowdowns caused by the pandemic.
Our inventory management system has three stages.
- First, we analyze sales statistics to see how each product is selling. For example, by analyzing sales over a six-month period, we can calculate an average of the products sold over half a year. This analysis becomes a good indicator of projected sales.
- Next, we employ our customer strategies, based on each customer’s sales data. We sell a certain number of products to a customer, then organize the sales by project. For example, say we sell a certain number of products for Project X, and another number of products for Project Y. We can then check with the client whether the project is going to continue, and for how long, allowing us to determine how many products we’re going to need over the coming months. Projects can last anywhere from a few months to several years, and that directly affects the types of machinery and replacement parts a given project will need. For that reason, the information our customers give us is a crucial part of our planning. It allows us to plan and adjust our stocks for future needs.
- Knowing the type of mining activities a customer is doing is also very important for planning our inventory. It allows us to determine what types of products a customer will need and for how long.
Analyzing this data lets us optimize our inventory planning, allowing us to meet customers’ needs as soon as they arise.
In our next blog article, we’ll be talking about our activities in Peru and sharing other factors that help us with inventory management, like the production cycles in a given country, as well as some of the elements that go into our planning.
In the meantime, you’re welcome to contact us to discuss your needs: http://www.mbiglobal.ca/en/contact/