It is recognized that customer demand is rarely perfectly stable and that this company is often required to maintain a “buffer stock” or a “security stock”. To minimize this pressure and costs, many of our customers use our service level agreements – SLAs – before contract; Price stability over the duration of a contract in the form of a appel-appeal contract; A timetable for delivery promises Agreed storage regular inventory monitoring reports and renewal of point alert orders. We know how important it is to provide our customers with a reliable and flawless supply of inventory. Precise readings are kept for each component to allow for immediate recall and immediate reporting. We are accredited and all inventory control processes are compliant with the British Standards Institution – BSI. In short, customer service is the priority of everything we do and we will do everything in our power to meet the needs of customers with intelligent stock management. This relieves pressure and costs and gives our customers the flexibility to be able to store as much or less as they need at any time during the term of the contract. We have a stock of thousands of wire/cable products and components, as well as hundreds of meters of wire and cables, all designed to be immediately brought to the production line. When companies estimate these costs, they often find that their storage costs vary between 30% and 40% of the available storage value. As a result, most companies charge a standard monthly storage fee of 3% on their stock. These 3% cover all of the inventory cost items mentioned above. Therefore, the focus should be on reducing this monthly fee by 3% through good contractual agreements.
How will this be done through the use of supply contracts such as framework contracts? In a globalized market where the importance of the supply chain is essential to building strong customer-supplier relationships, Express understands the importance of providing our customers with a reliable and seamless supply of inventory. Customer demand and storage requirements are known to be unpredictable and counter this, express Assemblies Ltd offers a purchase or purchase contract that allows our customers to purchase goods from our customers within an agreed time frame. In my last article, “Production Throughput: Inventory Holding Costs – Lost Time due to Material Shortages,” I talked about how a company can reduce its storage costs through contractual agreements. Today, I thought I would talk about how these agreements would allow companies to reduce storage costs over a longer period of time. The emphasis should be on understanding your company`s monthly storage costs and sharing those costs with your creditor through a framework contract or a large volume contract. So can a company actually reduce its ownership costs with the right agreement? 7) An agreed departure date from which the agreed minimum is placed 4) Reducing transit times – peak requirements (depending on storage) can be covered from the stock and then replenished, which is said above is just one example. However, when it comes to reducing your storage costs with contractual agreements, it`s really about identifying your company`s biggest storage reducers and using your flat-rate orders to reduce the impact.