Some thoughts from a Business Intelligence perspective.
Sometimes circumstances combine to make things as difficult and costly to do business as can be. The tight economic climate, burgeoning red tape, increased pressure from suppliers and competitors; they all conspire in their different ways to burden the hard-pressed entrepreneur.
Yet there’s a common factor to these disparate elements, and that is cost. The cost of competing in an often crowded marketplace alone is a life-or-death issue for many businesses.
So it follows that the efficient control of costs, and where possible cutting or eradication costs, is one crucial area where attention to detail can pay big dividends to a business’s bottom line.
So where does Business Intelligence (BI) come in?
Well, it becomes quickly apparent that there are many cost benefits to be had from well-deployed BI almost as soon as an organisation starts to use it, and the first and most obvious of these is stock control.
An early remark from a Sales and Marketing Director who uses Phocas sums up the value BI adds: “(before BI) things like specials, overstocks, etc, were a chore …………. without (BI), all we'd have is a bunch of steel sitting in a warehouse!" In another example, Australasian wholesaler ICCONS Managing Director, Phil Rose states: "We want to get our stock moving and Phocas gives us a clear view into our business."
Holding stock at the right level is a concern – especially in a sector where seasonality is an issue. A good BI tool can effectively plan seasonal variants into the provision of stock to cut the cost of missing out on peak-season sales and of course, the add-on costs of post-season overstocks.
Lead times are also important for many organisations in sourcing stock – especially long ones, where production processes are lengthy or stock is sourced abroad. Using BI to help plan and predict not only the products that are selling well but, using Current Run Rate, it can alert you as to when you need to reorder certain items.
Slow-moving and dead stock are a big subject for many companies especially since the cost of holding stock is a significant overhead – particularly where stock items have a limited shelf-life. BI can help to substantially decrease these costs from Day 1.
To watch our on-demand business intelligence webinar on Inventory Intelligence, please see the link at the end of this blog.
Efficiency of a company’s sales operation is crucial from a cost point of view are a crucial to consider when setting plans for a new financial year. Key Performance Indicators (KPI’s) such as actual sales vs customer potential – are often difficult to gauge, yet can be easily tracked with a good BI tool. This can have both margin and cost implications.
The same also applies to measuring sales call-rates against qualitative levels (the “who are we calling?” vs the “why are we calling them?”). It is often the case that fewer, well-planned sales calls to “non-safe” type prospects can involve lower costs with higher gains than more numerous calls on “safe” run-of-the-mill customers. Here again BI can bring analysis to bear on those costs.
Learn more about inventory intelligence and see how business intelligence can add value to inventory management in the video below: