Dave Gardner’s “Thank God It’s Monday” 13JUN11

“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.]

Thought for the week:

“At first dreams seem impossible, then improbable, then inevitable.”  – Christopher Reeve

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What do you think? I welcome your blog comments!

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Dave Gardner, Gardner & Associates Consulting http://www.gardnerandassoc.com

© 2011 Gardner & Associates Consulting  All Rights Reserved

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