Improved Working Capital & Inventory Management by Rationalizing 33% of SKUs

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The Challenge

A private equity-owned car care products company sought to enhance operational performance by focusing on SKU rationalization and inventory management. Rapid growth, driven by organic demand and expansion into new channels, posed challenges in servicing customer orders and optimizing working capital. TriVista was brought in help the business address current and future service and inventory improvement opportunities specifically related to current inventory and SKU rationalization opportunities.

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Our Approach

TriVista conducted site reviews, spoke with management, and reviewed internal materials. The following was conducted:

• Developed a model and approach to stratify product SKUs across primary channels and the organization
• Focused on item/channel volume, margin, and churn velocity for stratification
• Created a descending ranked item list by channel and overall, divided into quartiles
• Reviewed revenue and margin within quartile levels

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The Results

• Identified 33% of the SKUs for rationalization
• Developed a punch list of next steps for process maturity advancements
• Assisted the client in procuring a forecasting tool
• Provided overall demand and integrated supply planning recommendations
• Suggested next steps for the client to deploy internally, aiming for improvements in coordination, service, and optimized working capital