Problem: The perishable goods industry struggles with stock freshness, causing customer loss, profit erosion from discounting, and high write-offs. Forecasting errors and inventory mismanagement worsen the issue. Solution: A consumption-based replenishment model using the Theory of Constraints (TOC) optimises inventory, reduces lead times, and transitions to a pull-based supply chain. This solution ensures 100% availability, fresher stock, and lower inventory, cutting write-offs and discounting. Benefits: Benefits include improved profitability, faster new product launches, and greater operational efficiency.

Key Takeaways

67% of Indian consumers actively seek freshness when buying perishable goods. However, the industry is torn between delivering freshness and earning profits. Is there a way out?

Old is gold no more

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Vector Consulting Group - Research and Publications: Adopting replenishment based distribution instead of a forecast based inventory movement helps increase sales. Know more.

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