CARGOCONNECT-APRIL2025 - Flipbook - Page 34
SPECIAL FEATURE : FMCG LOGISTICS
many products, companies must adopt innovative
strategies to optimise inventory levels while ensuring
timely deliveries.
Narayan Prasad underscores the importance of
leveraging AI technologies to manage inventory e昀昀ectively.
“For FMCG industries, it’s now important to adopt AI
technologies, which are becoming instrumental in
reading customer behaviour and providing preventive
indications of demand,” he explains. Prasad also highlights
the need for alternative replenishment sources for
fast-moving items and the importance of technology
in eliminating the bullwhip e昀昀ect. “In every stage of
the supply chain, from demand to deployment, bu昀昀er
levels need to be reviewed to ensure optimal inventory
management,” he adds.
Pran Raj echoes this sentiment, emphasising the
role of advanced technologies in achieving the right
balance. “Accurate demand forecasting, powered by
AI and machine learning, allows companies to predict
demand with greater precision, reducing the risk of
both stockouts and overstocking,” he says. Real-time
data analytics further enhances this capability, enabling
dynamic adjustments to stock levels based on current
demand trends.
Raj typically highlights the e昀昀ectiveness of Justin-Time (JIT) inventory systems in minimising excess
stock. “Implementing a JIT system ensures that products
are produced and delivered just in time to meet customer
demand, reducing the need for large inventories,” he
explains. However, this approach requires 昀氀exible
supplier relationships. “Close communication with
suppliers ensures quick replenishment when inventory runs low, keeping turnover high without excess
stock,” he adds.
To optimise inventory levels, Raj recommends
using inventory segmentation techniques like ABC
analysis. “Classifying inventory based on demand
frequency and value helps prioritise high-demand
items for faster restocking while maintaining lower
stock levels for slower-moving items,” he explains.
SKU rationalisation is another key strategy. “Regularly
reviewing and optimising the product portfolio helps
reduce slow-moving or obsolete products, focussing
resources on high-turnover items,” he says.
Paramount is the importance of collaboration
across the supply chain is essential for balancing
speed and e昀케ciency. Raj emphasises the importance of
working closely with retailers and distributors. “Joint
forecasting e昀昀orts and real-time sales data sharing
help prevent both excess stock and stockouts,” he
explains. Vendor-Managed Inventory (VMI) is another
e昀昀ective approach. ”Allowing suppliers to manage
inventory levels at the retailer’s location based on
real-time data ensures optimal stock levels and faster
turnover,” Raj adds.
Keyur Doshi highlights the transformative role
of technology in inventory optimisation. “Inventory
optimisation helps FMCG businesses maintain just
the right level of stock to meet 昀氀uctuating demand,”
he says. “Advanced tools like IoT-enabled devices and
RFID tags provide real-time tracking, while automated
replenishment systems ensure timely restocking. By
34 | CARGOCONNECT APRIL 2025
VISHAL GARG
Head of Supply Chain Management,
CG Corp Global
By investing in efficient storage solutions
and leveraging in-house facilities at each
plant, companies can respond quickly to
local demand fluctuations. This proactive approach prevents stockouts and
reduces excess inventory, enhancing
overall supply chain performance. By
having dedicated storage facilities within
each plant, we are able to better handle
the specific inventory needs of each location. This setup allows us to
maintain adequate stock levels close to production sites, reducing
the time and cost associated with transporting goods between central
warehouses and production facilities.
mastering inventory optimisation, companies can cut storage costs,
improve cash 昀氀ow, and reduce wastage,” Doshi adds.
Doshi also emphasises the importance of leveraging data analytics
to track demand patterns. “Real-world examples show how companies
use advanced data analytics to 昀椀ne-tune inventory levels to market
needs. This approach minimises overstocking, reduces spoilage in
perishable goods, and ensures that store shelves are stocked with
customer favourites,” he explains, and further highlights key metrics
like stock turnover ratio, Days Inventory Outstanding (DIO), and service
level as critical indicators of inventory e昀케ciency. “Understanding and
categorising fast-moving, slow-moving, and non-moving items based
on sales patterns and production complexities is essential for e昀昀ective
inventory management,” he adds.
In the meantime, Raj shines the light on the bene昀椀ts of cross-docking
and regional distribution centres. “Cross-docking minimises storage time
by directly transferring products from inbound to outbound transportation,
reducing holding costs,” he annotates. Regional distribution hubs further
enhance e昀케ciency by minimising transit times and restocking delays. Raj
attests, “This setup ensures that products are available closer to demand
points, reducing the need for large inventories.”
Vishal Garg emphasises the importance of strategic sourcing and
in-house storage facilities in optimising inventory management. “Maintaining optimal stock levels for retail trade requires enhancing storage
