Effective inventory management is critical to staying competitive. Yet, many companies struggle with common challenges such as excess stock, frequent stockouts, and disjointed demand planning and buying processes. Without a unified approach, these inefficiencies lead to higher costs, wasted resources, and diminished profitability.

At Group O, we specialize in turning these challenges into opportunities. By streamlining and optimizing inventory management processes, we help businesses improve operations, reduce waste, and achieve measurable cost savings. In this article – we spoke with Alisha McNary, our VP of Business Development and Market Strategy for 3PL and Supply Chain Solutions and Jeremiah Green, one of our expert operations analysts, to understand the challenges companies face. We also take a look at an example of Group O’s unique and flexible approach to inventory management support with a cost savings analysis done for a prospective CPG client.

The Inventory Management Challenge

Across industries, many companies are carrying excess inventory—often as much as 30% or more than necessary. This is driven by use of outdated practices and disconnected systems. Procurement and inventory management teams often operate in silos, because they lack the visibility and tools needed to align their efforts. As a result:

1. Procurement teams are forced to base buying decisions on bulk discounts or instinctive guesses
2. Inventory managers are left grappling with stockpiles of obsolete or slow-moving products, because management hesitates to scrap or discount outdated stock due to fear of lost sales or future needs.
3. Warehouse managers are forced to spend money to procure additional storage space.

The above gaps cause businesses to have years’ worth of unused materials sitting on shelves because they don’t leverage an integrated solution that flags these areas for action. This results in excessive costs and significant inefficiencies for these businesses.

Group O’s Holistic Approach

Group O bridges these gaps with a three-pronged approach to inventory optimization:

Accurate Demand Planning: Companies often focus on immediate perceived cost savings instead of long-term savings, efficiency, and profitability.  Group O caters demand planning to the specific requirements of each customer, supplier, and guarantees a steady flow of material while mitigating any waste or tied up capital.
Integrated Technology: Many companies still rely on outdated warehouse management systems or manual processes. Group O modernizes these operations with Tier 1 ERP/WMS systems, providing real-time visibility into inventory health, reorder points, and supplier timelines. These systems consolidate data across procurement, warehousing, and shipping, enabling businesses to track KPIs such as on-hand quantities, aged stock, and stockout risks.
Actionable Analytics: Analytics are at the heart of effective inventory management. Group O’s technology generates actionable insights, such as identifying slow-moving stock or highlighting trends in SKU performance. This empowers continuous improvement and supports smarter procurement decisions that drive long-term cost savings.

Tailored Solutions for Every Need

Group O’s solutions are fully customizable. Some clients prefer to keep inventory in-house but lack the expertise to manage it effectively. In such cases, Group O provides managed services, including staffing and technology, to take over inventory operations. For others, we handle everything—from procurement and storage to distribution—within our facilities.

For example, in a recent engagement Group O created a cost-savings plan for a prospective client to significantly reduce inventory spend and reduce facility footprint while retaining the same sales and improved service levels by recommending implementing:

Smart Reorder Processes: Optimizing reorder points and quantities based on lead times could lead to an estimated 55-65% reduction in total inventory holdings and storage requirements. Saving millions of dollars in inventory carrying and storage cost.
Real-Time Reporting: Enhancing visibility into inventory health with alerts for aged stock and stockout risks empowers the client’s supply management team to operate more effectively and base their strategic decisions on data-driven, future forward information – ensuring optimal use of company funds for materials and warehousing.
Technology and Expertise: Using Group O’s Tier 1 ERP solution and team of supply chain, engineering, operations and client services experts ensures additional cost savings & creates opportunities for incremental revenue growth without expanding the facility footprint.

This tailored approach would deliver significant financial benefits, including annual savings of millions of dollars in inventory carrying costs, reductions in on-hand inventory levels by 60% or more, and millions in additional free cash flow through streamlined processes and faster cash conversion cycles.

Continuous Improvement

Inventory optimization isn’t a one-time fix—it’s an ongoing process. Group O emphasizes continuous improvement by iterating on strategies and adapting to evolving business needs. Through proactive communication, regular business reviews, and dynamic analytics, Group O ensures that its clients maintain efficiency and scalability as their businesses grow.

For example, Group O’s reporting dashboards provide real-time insights into sales trends, inventory levels, and supplier performance. These tools not only address inefficiencies but also foster collaborative decision-making to keep procurement, warehousing, and analytics aligned.

Why Choose Group O?

Group O combines cutting-edge technology, deep supply chain expertise, and a focus on measurable results. Whether businesses need support with forecasting, inventory management, or holistic supply chain optimization, we provide end-to-end solutions that drive efficiency and profitability.

Key Benefits of Partnering with Group O:

1. Improved inventory turnover rates
2. Reduced carrying costs and stockouts
3. Streamlined procurement and inventory alignment
4. Real-time visibility and data-driven decision-making
5. Business insights and performance targets specifically catered to the client, with an emphasis on partnership and mutual cost savings and growth

Ready to Optimize Your Inventory?

If you’re ready to reduce costs, improve efficiency, and take your inventory management to the next level, Group O is here to help.Contact Alisha McNary today to learn how Group O can transform your supply chain into a competitive advantage.