Client Profile

The client is one of the fastest growing enterprise having a combined turnover of Rs 100 crore and having its area of activities in automotive segment, textile processing and machine equipments.
 

Requirement

The client had to order the spare parts and consumables for its automotive division. The stock of the client had crossed its acceptable stock turnover norms and it was incurring high interest costs on the same. The ordering of the parts and the consumables was necessary to get the discounts and meet the target of purchases for the incentive schemes. The stock management was very poor and very mismanaged. The stocks which were of no use were also ordered to get the benefits of incentives.
 
5ve fine Engagement
5ve fine were awarded the contract based on findings of its preliminary feasibility exercise. Key reasons for this were:
  • Completely revamp the ordering procedures.
  • Make classification of the stock category according to its usage.
  • Maintain the stock level according to the acceptable norms of stock turnover.
  • Reduce the interest cost on the stock.

5ve Fine Solution
  • Find the stock consumption level of stock parts for the last two years.
  • Bifurcate the various stock parts according to the usage in ABC Stock Analysis Category.
  • Identify the stock parts which are critical for the organization and which if left in stock would cause overstocking to the organization.
  • The level for reordering and the maximum stock level and the minimum stock level determined.
  • Place the order for the spare parts according to the usage pattern of the last year and present need and see that if the part falls in critical category for the organization the part should be ordered only after determination of its requirement.
  • Saving of Interest cost.

Results

  • Cost savings in Interest.
  • Smooth operations.
  • Maintaining of proper stock level and avoiding overstocking.
  • Acceptable stock turnover norms.
Client Response
The client is widening the scope of processes outsourced with 5ve Fine and is now free from the problem of stock management.
 
 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
 
Five Fine Consultancy Services Pvt. Ltd.