DRAMATIC’ RESULTS FOR HALFORDS BV AFTER INVENTORY OPTIMISATION RE-THINK

A switch to UK-developed inventory management and stock optimisation software has sparked-off a dramatic improvement in product availability for Halfords BV, the Netherlands’ leading retailer of bicycles and auto accessories and sister company to the UK operation.

The move has also led to an increase in turnover described by MD Willem Marcelissen as ‘significant’.

As a direct result, the 160-outlet Dutch arm of the Halfords group – one of the largest non-food retailers listed on the Amsterdam stock exchange ¬– is now managing inventory running in excess of 1,000,000 skus with just three planners as optimal stock for all its stores is calculated automatically overnight.

Driven by the demand for fast, measurable successes in uprating inventory management, the company opted for Slimstock’s Slim4 on two counts – its track record of up to 30% reduction in inventory levels without loss of parts availability, as well as the developer’s mounting tally of successes specifically within the retail sector.

According to the group’s MD, one of the key issues had been the amount of time taken up by shop managers on daily re-ordering processes – time that, he says, could have been better spent with customers.

“At the same time we wanted to reduce both the number of stock-outs in the shops as well as the total inventory in our central DC: we realised that we clearly needed to take a professional approach to these issues” he said.

The company’s initial explorations centered on making better use of its existing ERP system – a direction quickly ditched when it was found that functionality for demand planning and inventory management proved to be insufficient for projected demands.

Stage 2 involved making an overview of all available specialised solutions. Willem Marcelissen added that researchers discovered that Slimstock emerged as the company with the widest experience of the retail industry and also as the only developer in the running with the ability to tailor its software tools to the company’s specific demands ¬– a view endorsed by other companies using Slim4 and its Microsoft implementation partner.

“Our margins are tight so we demand fast measurable successes and want to get the best out of our organisation. Because of this we are highly selective when choosing our business partners so we can offer our customers real value for money” he said.

Results proved dramatic, with ‘noticeable reduction’ in total inventory and improved availability being recorded after just eight weeks’ implementation at the firm’s central warehouse.

The company then started the roll-out to shops – initially selecting ten pilot stores. Within a matter of weeks all ten had reported an increase in sales compared to the others, gaps on the shelves had been reduced without adding inventory, and more time freed-up for shop managers to focus on customers

Additionally, managers were reporting availability running consistently higher than before, with a corresponding decrease in time spent checking stock levels.

“That was reason enough for us to go ahead with the roll-out to all shops” says Willem Marcelissen”: “...the result is that today all shops are better stocked and have lower operational costs.

“Every night the optimal stock for all out shops is calculated automatically. We can now manage the inventory in all out 160 shops with only three planners – and they take care of over a million SKUs!”

Slimstock’s UK arm is based in Coventry where the software was originally developed, and the results coincide with Slim4 being judged as ‘the most innovative idea in retail excellence’ by £1 trillion asset Amsterdam-based global banking, investment and insurance company ING Group.

Now firmly established in the UK following significant expansion alongside dramatic year-on-year gains in Holland, Belgium, France, Germany, Italy, Spain and Denmark, the company has more than 400 customers and is recognised as the leading European provider of specialised software in the field of forecasting, demand planning, supply chain management and inventory management.

Recent new UK deals include Flowtech, Hobbycraft, Technetix, Wilsonart International and BMI Healthcare. Additionally, Watts Industries, Intertruck and 400-pharmacy outlet Mediq are also included as recent key gains.