In a supply chain, inventory is the greatest shock absorber for variability. But in the past five years:

• Demand variability has increased with the proliferation of items and channels and the increase in promoted goods.
• Supply variability has escalated with the greater dependence on offshore sourcing.

Retailers that want flawless product availability—without excessive inventory—need a timely and accurate picture of inventory positions across their distribution centers and stores. According to the most definitive study conducted to date on out-of-stocks*, this goal is a long way off. The study uncovered that:

• Stock-outs occur at an average of 8.3% globally
• Promotional items experience an average of 13% stock-outs
• Each year, companies lose $2.5 billion due to obsolete inventory

Without real-time visibility to stock in-store, in-warehouse, in-transit and on-order, retailers struggle to commit to customer orders, suffer from declining order fill rates, and experience difficulty delivering orders on time.

* Retail Out-of-Stocks: A Worldwide Examination of Extent, Causes and Consumer Responses,
GMA/FMI/CIES Study, 2002

The Imperative for Vendor-Managed Inventory
Smart retailers recognize the benefit of involving suppliers in inventory management decisions. By sharing this responsibility with suppliers, retailers:

• Free up valuable human resources
• Get raw materials and work-in-progress inventory off their balance sheets
• Reduce the amount of working capital needed to manage their business

Suppliers also have natural incentives to monitor the availability and performance of their products within the retail network. Suppliers can:

• Facilitate production and transportation planning
• Leverage the better knowledge of their products and product marketing activities

Monitoring inventory in real time and creating a framework for collaborative order decision support can be a challenge. The ideal inventory visibility solution must have the following characteristics:

• Real-time: Critical alerts and reporting of inventory must be delivered continuously, in real-time or near real-time, to enable intelligent decision making and action.
• Accurate: Smart decisions require data that accurately reflects the true levels of inventory.
• Optimized: The solution must utilize existing infrastructure investments without requiring extensive data consolidation or integration projects.

Benefits

By combining the power of GXS Inventory Visibility and the ease of access enabled by GXS Enterprise Gateway and GXS Partner Gateway, your supply chain can extend inventory monitoring from the smallest supplier on up.

• Maintain high customer satisfaction and protect brand integrity: Ensure that your products are available and delivered in a timely manner. Store-level out-of-stocks damage consumer satisfaction.
• Improve productivity and profitability: An accurate, continuous view of consumption and sell-through can help enterprises improve product mix management and avoid costly shortages.
• Easy to deploy with minimal IT resources: GXS Inventory Visibility is a fully hosted solution, requiring no software or hardware implementation and only a low, up-front capital investment.

Features

GXS Inventory Visibility empowers your suppliers with timely and accurate product inventory information—obtained directly from warehouse management and store operations systems. The solution features:

• A Web-based Dashboard: Your suppliers can securely access all the information they need via an easy-to-use and intuitive interface. .
• Email & Dashboard Alerts: Information can be monitored on an exception basis to ensure that inventory problems are visible and addressed.
• Robust Search Engine: Inventory status searches can be performed based on desired criteria such as retailer name, SKU number, product description, stock condition and location. Custom reports can be created and stored for regular review.
• Flexible and Extensible Product Attributes: In addition to standard product attributes, custom data fields can be added to meet specific retailer and supplier needs.
• Configurable Replenishment Time Period: Supports all your suppliers, regardless of whether they are on a weekly, monthly, quarterly or seasonal replenishment cycle.
• Configurable Location Hierarchy: Suppliers can quickly map and establish the hierarchical relationships between your store, state, district, regional and corporate distribution centers.
• Supplier Community Enablement: Participation of your supplier community in your inventory visibility program is fundamental to its success. GXS Community Link helps ensure 100% supplier enablement.