Slow-Moving Inventory

Problem

Inventory that remains unsold for extended periods ties up capital, increases storage costs, and risks obsolescence, negatively impacting cash flow and operational efficiency.

Insight

Multiple items are currently sitting on over two years worth of inventory based on the calculated months of supply. This prolonged stagnation in inventory suggests potential overstocking or misaligned demand forecasting. Addressing these items will be crucial in optimizing your working capital.

‍Impact

‍By identifying and addressing slow-moving inventory, the client can improve cash flow by reducing excess stock, adjusting procurement strategies, and revamping sales or marketing efforts to liquidate stagnant items. This action can potentially free up a significant portion of working capital.