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Safety Stock Epicor ERP 10

Safety Stock Feature Keeps Costs Down and Profits Up

It’s that time of the year, the holiday season. Manufacturers of consumer goods have been working hard to get orders shipped. Whether your business is seasonal or cyclical, there are strategies you can take to keep production moving forward and your profits highest. One such strategy is having the right amount of safety stock available.

Safety stock is a safety net for supply and demand. Fluctuating vendor lead times, transportation delays, and unanticipated customer demand can all result in potential inventory stock outs. Inventory stock outs can impact customer satisfaction and potentially lead to lost sales, lost gross profits and lost market share.

The formula-based Min/Max/Safety Stock feature in Epicor ERP helps companies manage safety stock quantities which in turn helps manufacturers minimize production delays caused by inventory stock outs while also giving management the needed confidence to carry less ‘just in case’ inventory.

Having the right amount of safety stock is key to keeping production moving forward and unexpected production related expenses down. For example:

  • Adequate Safety stock means you won’t be forced to pay costly expedited shipping fees because inventory was depleted to the point where you couldn’t meet customer demands on time.
  • The right amount of Safety stock means your company won’t be burdened with high carrying costs, also referred to as inventory holding costs because ideally you’ll be receiving replenishment stock just in time.
  • Managing Safety stock means your business has taken precautions to minimize, if not eliminate inventory related production delays.
  • Reducing stock outs with Safety stock, in short, keeps costs down and profits up.

The amount of safety stock that a manufacturer should have readily available varies and should never be left unmonitored as today’s international marketplace is continually changing. Factors such as history usage, lead time and travel distance from supplier to you, should also be taken into consideration.

The formula based Safety Stock feature in Epicor ERP calculates safety stock based on a variety of factors. Once the safety stock feature is set, Epicor EPR will help assure management that inventory levels are able to handle production requirements. If inventory levels dip too low, then Epicor will automatically alert management so the appropriate actions can be taken.

In summary, the safety stock feature not only reduces production delays and carrying costs, it helps with customer retention and customer satisfaction too. Each of these factors can lead to lower costs and higher profit margins.

Have questions or need more information on how inventory management can impact your bottom line? Contact MIS. MIS, with 30 years of experience helping companies like yours identify technology solutions, can show you how Epicor ERP uses the latest Microsoft technologies, combined with industry best practices, to help you meet your business goals and objectives.


Karen Beaulieu

Karen Beaulieu has worked in the ERP software industry for over 15 years. Having worked in a variety of roles from product development, channel and direct sales to marketing, Karen has a unique understanding and perspective of the ERP software industry. Currently Karen works in a marketing capacity for MIS Consulting & Sales and MIS Solutions Canada, ULC.

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