eKourier April 2014

FEATURES

No Margin for Error...

the Best Practices (or in tune with Momentum 2012, ‘Next Practice’) and create a common platform for sharing knowledge and experience on how to improve. What are we trying to achieve? To meet or exceed customers’ expectations of product availability by maintaining the amount of each item that will maximise our gross margins and overall profitability. As a first step, let us focus on inventory control and how to build on our existing controls.

To be continued…

Sathish Gopinath Financial Controller

M ost of us keep a pretty idle.

number of centres but also due to activity. In April 2013, we switched from Visy to Amcor to achieve economies of scale and better procurement options. Beyond improved sales and operations, managing inventory better means improved cash flow and liquidity, something difficult for many businesses in today’s tough economic times. And above all, it also allows us to give customers the ‘complete storage solution’. “ Inventory Management involves determining when to order products and how much to order, as well as identifying the most effective source for each item. ” This presents us with the enormous opportunity to revisit our business processes in this area and continuously improve. And the question is “where do we start?” Over the next few editions, I want to share and discuss with the wider business,

Customer Feedback “I could not fault the Kennards Cardiff business and staff, they were very accommodating and professional. Myself and family will certainly have Kennards as the preferred business when we require this service again.” “Your staff are brilliant! Leon at Three Kings recommended a transport carrier, he also ensured my gear was loaded and took the time to call me and let me know it had left the branch which was really appreciated. Sue and her Team in Wellington ensured my gear was safely stored in the Wellington branch and I did not have to do a thing.” “Signing up with Kennards was very easy, the staff were wonderful and the storage space very clean. We liked that we had 24/7 access, that the centre is very secure and that we were refunded unused rent.” “At your store in Milton, my house mate and I were very pleased to work with a gentleman called Cameron. He was very efficient, polite and quite knowledgeable about the whole storage system/process. He made the whole situation a lot less stressful than we thought it was going to be and we were very impressed with his work ethic.”

good eye on our cash, we don’t leave it lying around uncontrolled, unattended or

Inventory and cash are the same from an accounting perspective, both are assets. While the purpose of inventory is to be sold and make a profit, the profits/ margins depend on how well a business ‘manages’ and ‘controls’ its inventory – from the point of ordering, receipting, pre and post sales activities, periodic stock takes, customer service and managing returns/buy back. Inventory control involves managing the inventory that is already in the store. That is, knowing what products are out there, how much you have of each item, and where it is. Inventory Management involves determining when to order products and how much to order, as well as identi- fying the most effective source of supply for each item. Inventory management includes all of the activities of forecasting and replenishment. As a business, our merchandise sales are currently around $6M per annum and continue to grow. This constitutes almost 50% of non-storage related income. Our average stock holdings have doubled, not necessarily due to increase in the

7 Kennards Kourier April 2014