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Professor John Manners-Bell
John is Chief Executive of Ti, Honorary Visiting Professor at the London Metropolitan University’s Guildhall Faculty of Business and Law and an adviser to the World Economic Forum. He has over 25 years’ experience working in and analysing the global logistics sector.
Andy is a quantitative analyst at Ti. He graduated from the University of Southampton with a Mathematics with Finance degree in 2014. In his studies, he chose a final year project on actuarial modelling and forecasting and enjoyed modules on statistical distribution theory, financial mathematics and macroeconomics.
Tony is a supply chain professional with over 30 years’ experience in the sector. After working in operational supply chain management with Xerox Corp, he held senior management and Board Level roles with companies in the fields of Freight Forwarding (MSAS UK, Uniserve Scotland), 3rd Party Logistics (DHL, UPS SCS, ZIM Logistics), Supply Chain Technology (including the world’s first cloud-based supply chain visibility system Sourceree) and consultancy (LCP Consulting, Supply Solutions). He has served on the Board of Directors of companies in the UK, USA, Switzerland, India, Russia, China, Hong Kong and Jamaica and has enjoyed expat assignments in Belgium and Switzerland.
A long career in retail supply chain operations with a major global retailer has given Zen an expertise in strategic supply chain change management and operational detail. He was responsible for transforming the supply chain for Marks and Spencer PLC its over 400 suppliers in 5 continents. He is practiced in setting up and operating supply chain operations in the Far East, South Asia, Middle East, and Turkey, and has developed logistics and distribution hubs servicing UK and international markets. He has acted as a consultant to major UK and European retail customers on matters of supply chain transformation and has undertaken board level coaching on matters of procurement and supply chain optimisation, and develops advanced negotiating skills within senior management teams of international companies. Zen is visiting lecturer at Westminster University in the UK on matters of fashion industry supply chain and business administration.
Key Findings 7
- Introduction 10
Supply Chain Management and Company Performance 11
The key benchmarks 12
Increasing inventory levels 14
Industry sector performance 17
Industry sector DSI progression 18
Cross-industry upper quintile DSI 19
Cross-industry lower quintile DSI 20
- High Tech 21
2.1 High Tech: Consumer Electronics 22
Company DSI: Ten lowest 23
Most days added/reduced 24
Hewlett Packard 28
Selected company comparisons 38
Inventory metric comparisons 39
DSI Table 41
2.2 High Tech: Other 42
Inventory strategy overview: Contract Manufacturing 43
Inventory strategy overview: Semiconductors 45
Company DSI: Ten lowest 47
Sector DSI average progression 48
Most days added/reduced in past 10 years 49
Western Digital 56
DSI Table 58
3.0 Retail 59
Inventory trends – the impact of e-retail 60 Amazon 63
3.1 Retail: Department Stores 67
Average DSI 68
Most days added/reduced in past 10 years 69
John Lewis 70
DSI Table 77
3.2 Retail: Supermarkets 78
Trends in DSI 80
Marks & Spencer 85
DSI Table 93
4. Pharmaceutical 95
Inventory management in pharmaceuticals 96
Most days added/reduced in past 10 years 99
DSI meaning for the industry 100
Johnson & Johnson 101
DSI Table 107
- Automotive 108
Inventory trend 109
Company DSI: Ten lowest 110
DSI Table 126
- Fashion 127
Inventory strategy overview 128
Inventory strategy overview – Fast Fashion 130
Inventory strategy overview – Luxury Brands 131
Company DSI: Ten lowest 132
Sector DSI Average progression 133
Most days added/reduced in past 10 years 134
DSI Table 140
- Consumer Goods 141
Inventory strategy overview 142
Ten lowest DSI 145
Most days added/reduced in past 10 years 146
Selected manufacturers 147
Procter & Gamble 151
DSI Table 160
Inventory levels see decade long rise, says new Ti report.
June 25th 2019, London, UK: It could be assumed that several decades after supply chain management practices such as ‘lean’, ‘build-to-order’ and ‘just-in-time’ became accepted across industry, inventory levels would have seen a steady and inexorable decline.
However, the latest report by Transport Intelligence, Inventory Benchmarking Vertical Sector Trends, has found that the stock held by manufacturers and retailers, as measured by Days of Supply in Inventory (DSI), has actually risen over the past ten years.
This data, based on the financial reports of 187 manufacturers and retailers located around the world reveals that, on average, companies in 2017 were holding 10 more days stock than in 2008: increasing from 80 to 90 days. The research also found that the retail industry operates with the lowest average DSI: 33 days in 2017. At the other end of the spectrum, the pharmaceutical sector operates with an average of 186 days.
According to one of the authors of the report, Professor John Manners-Bell, this indicates that reducing inventory levels is just one of a number of competing goals for many companies. “Despite the textbooks telling us that inventory reduction should be the main goal for supply chain managers, the present market environment requires a far more sophisticated approach, balancing a range of important objectives.”
Examples of this new approach include Walmart, which now regards the availability of stock to purchase by consumers as a major factor in its existential battle with Amazon, despite the inevitable consequence of higher inventory. Lenovo and Hewlett Packard took a similar approach to building up inventory in order to maintain product availability in physical stores in contrast with Dell’s lean inventory strategy. Risk is also a factor, as companies seek to avoid the supply chain problems they faced after a number of high profile disruptive events in the early part of the decade, such as the Thai floods and Japanese tsunami.
Co-author, Andy Ralls, added, “A focus on achieving an appropriate amount of inventory is and always will be hugely important to efficient supply chain management. However, as our research shows, competing priorities, be they driven by e-commerce, changing customer demands, product development, risk or even regulatory requirements, have caused many companies to fundamentally assess their supply chain strategies.”
About Inventory Benchmarking Vertical Sector Trends
A critical benchmark for inventory management. Inventory Benchmarking Vertical Sector Trends compares many of the world’s leading manufacturers and retailers against key financial supply chain metrics.
In particular it:
- Defines the key ratios available from financial disclosures
- Conducts a by-industry vertical sector analysis of inventory management and benchmarking data for the high tech, automotive, retail, pharmaceutical, fashion and consumer goods industries
- Examines the supply chain and inventory management strategies of selected blue chip companies with reference to these benchmarks
- Where available, examines the different types of inventory held by these companies and how these have changed
- Compares and contrasts the performance of these companies.
The report also includes exclusive access to an online data pack with interactive charts, tables and downloadable data.
Find out more about the report by clicking here
About Ti: Transport Intelligence (Ti) is the leading source of market research and intelligence for the global supply chain and logistics industry. Since its founding in 2002, the company has delivered a range of research products and consulting solutions to the world’s largest retailers, banks, consultancies, shipping lines and logistics providers, and become trusted advisors to global institutions such as the World Economic Forum, the World Bank, the UN and the European Commission.
For any enquiries, please contact Ti’s Head of Commercial Development, Michael Clover +44 (0) 1666 519907 [email protected]
Linkedin: The Transport Intelligence Forum