These changes can improve your business with little or no human intervention.



If you are a PHCP, PVF and/or HVACR distributor who is using inventory management software that can be modified, you may want to change it in a way that will reduce inventory shortages and excess. That, in turn, will increase the level of customer service and decrease inventory investment. Other benefits include reduced purchasing efforts, rush orders, expediting, clearance sales and returns to vendors. Also, warehouse space would be freed up; less effort would be needed for receiving, put-away and counting; and staffing might be reduced.

Listed below are some of the possible changes that can be made to inventory management systems. They are all meant to function automatically, so little or no human intervention is needed.

  • Analyze order history data for unusual data that would distort inventory levels. If a condition is within a pre-defined tolerance, adjust the data; if a condition is outside the tolerance, list the item on an action report.

  • Calculate safety stock based on target service level and the factors that can result in not having enough planned stock on hand when it’s needed.

  • Allow for trends when calculating lead time.

  • If the history data for an item is outside the tolerance, don’t calculate safety stock or lead time or a forecast; list the item on an action report.

  • If the history data for an item contains too many gaps, don’t calculate safety stock or lead time or a forecast; list the item on an action report.

  • Treat very slow-moving items differently than items that move fast, but don’t require human intervention - treat them automatically.

  • Let the system determine the most accurate method of forecasting.

  • The system can determine the most profitable service level.

  • Identify items for which the service level is too high.

  • Calculate the true cost of buying more than is needed now vs. waiting and buying later.

  • Calculate whether a deal is too good to be true for the distributor (it’s always good for the supplier).