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JIT inventory, best way to inform customers of Out of Stock

     
4:23 pm on Dec 20, 2007 (gmt 0)

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Hi,

I found a fulfillment company that is maybe 3 miles away from my supplier.

I can basically do Just-in-Time inventory now, but the problem is I want to avoid having to phone customers of products not in stock.

Unfort. the supplier doesn't have a way for me to hook into their backend system so I could get live inventory information.

What would you guys recommend is the best way to handle this?
(keep in mind that I have thousands of SKU's here, so I can't really stock it all plus I want to avoid dumping $ into inventory in the beginning).

3:14 pm on Dec 21, 2007 (gmt 0)

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find a new supplier that does inventory level reporting. You will have nothing but problems on manual inventory maintenance of your suppliers!

The other option is to mark all that suppliers stock as call in.

You ask for tons of charge backs/cancellations and ticked off customers when your inventory is incorrectly reflecting stocks or availability!

4:27 pm on Dec 21, 2007 (gmt 0)

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They do have inventory counts, but you have to login into their Mas 200 software to find out. And I also have the option of sending them an excel file that they could run against their system to get inventory counts.

The problem is that I will have to do this everyday, and also email customers about out-of-stock etc.

I don't really have any options with suppliers, this is a very tight industry and this supplier is one of the few who will sell to me w/o having a real store.

4:45 pm on Dec 21, 2007 (gmt 0)

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well, it sounds like you have a technical problem to solve. Since i use about 10 distributors myself and they all have different price feeds we wrote an ETL loader to import, massage, manage and combine our feeds and update our system daily.

Some distributors offer an API to get current feeds and we use that when possible if we use them to dropship.

I use Apatar ETL tool and recommend it.

7:38 pm on Dec 21, 2007 (gmt 0)

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We have been struggling with a similiar type of problem and have come to the undesirable conclusion that JIT is not going to be viable for us in the long-run. We are just going to have to suck it up and allocate having more $$$ invested in inventory.

Sure it does not seem like the best use of our capital, which is always limited no matter what your size, but it is what is necessary in order to move forward in our industry.

7:49 pm on Dec 21, 2007 (gmt 0)

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JIT can work with a few sources but really, its optimal keeping your core competency local as well so you can focus on the business and keep your customers happy.

Suppliers always have a habit of treating themselves first unless you're the top 1% of there market :)

8:48 pm on Dec 21, 2007 (gmt 0)

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This is really the only supplier I have, the other 2 major ones (and I mean major) refuse to sell unless I have a store.

All of my other potential sources are mfg's and I would just stock their products.

I just wish I could get them to product even a static inventory report daily, that would cut down my legwork.

10:16 pm on Dec 21, 2007 (gmt 0)

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Could you even from a financial standpoint afford to do some kind of a token store so that the store requirements are met?
9:17 pm on Dec 22, 2007 (gmt 0)

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things are more complicated than that, I live in Canada and if I even opened a store they would *only* ship to my store address (and obviously the US is my target audience).
2:17 am on Dec 23, 2007 (gmt 0)

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Call the customers, tell them you will offer a refund if time is an issue. 90% of the customers will stick with the sale and actually tell you thanks for the phone call.
5:24 pm on Dec 23, 2007 (gmt 0)

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JIT works if you have real-time quantity counts. If you give too many refunds for out of stock, your merchant processor may also audit you and raise your processing rates.
1:04 pm on Dec 24, 2007 (gmt 0)

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Well I could then just capture the funds, and then do the actual charge when I get the items in the warehouse.