“Thank God It’s Monday” is to help companies thrive!
This week’s focus: configurable products and services
Out with the old; in with the new. Acer had to write down $150 million in European inventory just this past week as the inventory had passed its prime.
The mass production paradigm comes with a substantial potential cost penalty: what doesn’t sell must be deeply discounted or written off. Want proof? Look at all the “end of season” sales–40% off, 50% off, 70% off and more.
Why does this happen under mass production? It is nearly impossible to align supply with actual demand. Is there a solution?
Build to order postpones committing inventory until a named customer appears. While it doesn’t totally eliminate risk, it can reduce the risk of finished goods inventory obsolescence dramatically. This paradigm can help a company thrive.
[Read my entire Fast Company Expert Blog post: The High Risk of High Tech Inventory.]
“At first dreams seem impossible, then improbable, then inevitable.” – Christopher Reeve
What do you think? I welcome your blog comments!
Dave Gardner, Gardner & Associates Consulting http://www.gardnerandassoc.com
© 2011 Gardner & Associates Consulting All Rights Reserved
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