K3S https://k3s.com We Know Inventory Thu, 26 Mar 2020 15:16:30 +0000 en-US hourly 1 https://wordpress.org/?v=5.5.1 Working from Home https://k3s.com/working-from-home/?utm_source=rss&utm_medium=rss&utm_campaign=working-from-home https://k3s.com/working-from-home/#respond Fri, 13 Mar 2020 20:03:16 +0000 https://k3s.com/?p=594 Could your buyers work from home? Is your business feeling the stress of the potential scenario that your employees may need to work from home? COVID-19 is causing many businesses, schools, and sports seasons to suspend their regular means of operation. They are preparing for the current reality of this rapidly spreading virus, but more …

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Could your buyers work from home?

Is your business feeling the stress of the potential scenario that your employees may need to work from home?

COVID-19 is causing many businesses, schools, and sports seasons to suspend their regular means of operation. They are preparing for the current reality of this rapidly spreading virus, but more importantly what the situation could become in the near future. This is causing the need for more employees to work from home to keep each company operational.

Could your buyers work from home if needed?

We have designed our tools and training for any scenario, including social distancing. Whether collaborative in house, or working remote, we will help make sure your company is prepared.

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The Inventory Iceberg https://k3s.com/the-inventory-iceberg/?utm_source=rss&utm_medium=rss&utm_campaign=the-inventory-iceberg https://k3s.com/the-inventory-iceberg/#respond Mon, 07 Oct 2019 16:08:28 +0000 https://k3s.com/?p=477 In 1912, the Titanic left England on it’s way to New York, but it never made it. The iceberg it hit in the North Atlantic, by most estimates, was only small to medium-sized. But the message that iceberg sent was clear: No matter how large the ships, or how great their engineering, they were not immune …

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In 1912, the Titanic left England on it’s way to New York, but it never made it. The iceberg it hit in the North Atlantic, by most estimates, was only small to medium-sized. But the message that iceberg sent was clear: No matter how large the ships, or how great their engineering, they were not immune to the dangers that icebergs presented.The reality is that every day your business is forced to navigate a field of icebergs, any one of which could threaten to “sink your ship” if not spotted early enough, giving you enough time to avoid the collision. One of these icebergs is the inventory in your warehouse.

When I ask people how much they think it costs to carry inventory in their warehouse, the answers I hear vary widely. The most common response I hear, however, is: “With today’s interest rates, not much”. As the saying goes, however, the interest you pay on your inventory only represents “the tip of the iceberg”. In fact, although it varies depending on your industry, the interest you pay on your inventory can represent less than 5% of the total cost of carrying that inventory!

Like an iceberg, the bulk of your carrying cost lies hidden below the water. This is the part of the iceberg that can sink your company if don’t recognize it soon enough. Let’s explore some of the areas that contribute to the total cost of carrying inventory and why it’s important to remember them as you consider the amount of inventory you can comfortably carry.

Cost of money:

The first, and by far largest factor in inventory carrying cost is the cost of money. Yes, this includes the interest you are paying on your money, but it’s much more than just that. The larger part of the cost of money comes from lost opportunity cost. If you currently have $5,000,000 of inventory, you likely have that sitting on a credit line. If you could reduce your inventory to $4,000,000, what would you do with the $1,000,000 of increased cash flow? Would you let it sit unused? More than likely not. You would probably reinvest it where it could help your company. New trucks, expanded territories, additional people, and newer, more efficient technology all become possible with that increased cash flow.

This cost is typically seen as about 15% of your average inventory.

Storage:

Whether you own or lease, you are paying for warehouse space. The more inventory you have, the more warehouse space you need. In addition, you may have an expensive set of racks, conveyors and mezzanines. If you didn’t have so much inventory, what would you do with the smaller space requirement? Would you have a smaller warehouse? Could you rent out the extra space? Would you expand your product offerings? If so, please see: “Opportunity Cost”.

Storage cost typically adds 4% to your carrying cost.

Taxes:

As Ronald Reagan said, “Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.” Your inventory is always moving…so the government will tax it. Some districts tax inventory outright. The more inventory you have, the more taxes you will pay. Even if you are fortunate enough to operate in a district where this is not the case, most accounting rules see inventory as an asset. Any time you increase inventory, it shows as a “profit” and will be taxed as such.

Taxes will generally add 2.5% to your annual carrying cost.

Obsolescence:

There’s no denying it, as quickly as trends come and go in this day and age, there will be times when products in your inventory will become obsolete. No matter how efficient your buying staff or how long they have been in their roles, they can’t possibly anticipate every change in the market. If you have any VCRs in your warehouse today, it’s a safe bet they won’t be going anywhere.

Typical losses due to obsolescence and spoilage is 1%.

Shrinkage:

This category should not be confused with obsolescence. This category includes inventory that came into the warehouse and should have been sold but can’t and won’t be. Where as obsolescence and spoilage have to do with purchasing and the market demand, pilferage and damage can often be attributed to human behavior in your warehouse. Although this cost can vary greatly from one industry to the next, and can often be controlled and reduced, it can never really be eliminated.
Whether a forklift hits a pallet, a jar gets dropped during handling, or someone gets over zealous with a box cutter, damaged products in a warehouse are a fact of life and must be accounted for. The longer something sits in your warehouse, the greater the risk of it being damaged or disappearing.
The typical cost associated with shrinkage and damage is 1%.

Insurance:

Your insurance company is most likely charging you based on the average amount of inventory you have on-hand in your warehouse. Although this cost is not huge, it is still present.
Insurance costs are typically .5%.

When it is all added up, the cost of carrying your inventory can easily exceed 25%!

So there you have it. What started out as a small problem, paying 1-2% interest on your inventory, has become a tremendous liability that could threaten to sink your company if it’s not managed properly. After all, it wasn’t the tip of the iceberg that sank the Titanic; it was the much larger section that lay hidden below the water.

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3 Ways purchasing through spreadsheets costs you money https://k3s.com/3-ways-purchasing-through-spreadsheets-costs-you-money/?utm_source=rss&utm_medium=rss&utm_campaign=3-ways-purchasing-through-spreadsheets-costs-you-money https://k3s.com/3-ways-purchasing-through-spreadsheets-costs-you-money/#respond Mon, 07 Oct 2019 15:36:54 +0000 https://k3s.com/?p=474 “Too much inventory costs you money. Not having enough, will cost you customers.” ~Rick Fine, President of Duncan Supply The most efficient, effective, and profitable distributors use an advanced inventory package to help them purchase their inventory because it makes a tremendous difference in their bottom line! But maybe you know that purchasing with spreadsheets is not …

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“Too much inventory costs you money. Not having enough, will cost you customers.” ~Rick Fine, President of Duncan Supply

The most efficient, effective, and profitable distributors use an advanced inventory package to help them purchase their inventory because it makes a tremendous difference in their bottom line!

But maybe you know that purchasing with spreadsheets is not the best way, but you don’t know why.

The challenge comes when you are trying to determine the right amount to buy because let’s face it, you can never honestly know for sure.

That is why Demand Forecasting is the first step in buying inventory.

When you are forecasting your product demand, it comes down to gathering the data.

You will need accurate demand history for each of your products.

How far back do you look when you analyze your product demand?

And…

When you get the demand data, what do you do with it?

It can be challenging to consider all of the variables.

That is why there are three ways you are losing money by purchasing with spreadsheets:

1. Carrying TOO MUCH Inventory

The cost of inventory is an EXPENSE and carrying too much is EXPENSIVE.

If you are not utilizing the warehouse space you have with the products you ACTUALLY need, then you are throwing away money.

Why?

Because it costs money to hold and carry your inventory, whether you think you need it or not.

And if you are using space with products you DON’T need, then where are you storing the products that you DO need that leads you to improve your fill rates?

2. Losing Sales

Are you buying enough inventory to account for your cycle times?

Not only will you need to account for demand, you will also need to consider your lead times and order cycles.

The flip side of having TOO MUCH inventory is not having ENOUGH inventory.

Knowing demand is not enough!

If you are not ordering enough to cover you in the time between orders and the time it takes to ship your product, then you are missing out on sales!

We would like to help you do the same!

Don’t waste any more time.

3. Wasting Time

Are you exporting the data into spreadsheets and using complicated formulas?

While this might work for you, it is essentially the LOOONNNNNGGGGGG way to an answer that should take you much less time!

Why use complicated spreadsheets leaving you with a ton of files sitting on your desktop when you can have it all done automatically for you in just a few seconds?

At K3S, we help our customers navigate through the entire process of buying inventory which starts with Demand Forecasting.

We would like to help you do the same!

Don’t waste any more of your time.

For a limited time…we are offering a Free Inventory GAP Analysis

With the Inventory GAP Analysis, you will learn more about how you can pick up the tools to:
1. Lower your inventory by 20%
2. Increase your fill rates (which will lead to you increasing sales)
3. Save yourself a ton of time!
Stop purchasing your inventory with spreadsheets! If you go with K3S it will literally pay for itself, guaranteed!

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K3S to Attend the SLD https://k3s.com/k3s-to-attend-the-sld/?utm_source=rss&utm_medium=rss&utm_campaign=k3s-to-attend-the-sld Thu, 03 Oct 2019 15:24:39 +0000 https://k3s.com/?p=467 For several years, K3S has been active in an organization called the Southern Association of Wholesale Distributors. This is a regional trade organization for convenience distributors serving the Southeast.  Each fall, the host a meeting called the SLD (Southern Leadership Division) Business Resource Meeting.  Unlike the annual tradeshow, this event places a strong focus on leadership skills, …

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For several years, K3S has been active in an organization called the Southern Association of Wholesale Distributors. This is a regional trade organization for convenience distributors serving the Southeast.  Each fall, the host a meeting called the SLD (Southern Leadership Division) Business Resource Meeting.  Unlike the annual tradeshow, this event places a strong focus on leadership skills, management training, and business planning.

This year, K3S will be very well represented when Brantley May and Joyce Poh travel to Hilton Head, South Carolina to participate in the meetings.  For more information on the SLD, visit the Southern Association of Wholesale Distributors online

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K3S to attend the SAWD https://k3s.com/k3s-to-attend-the-sawd/?utm_source=rss&utm_medium=rss&utm_campaign=k3s-to-attend-the-sawd Mon, 03 Jun 2019 14:15:37 +0000 https://k3s.com/?p=457 For several years, K3S has been actively involved with the Southern Association of Wholesale Distributors (SAWD).  This is a regional group of food and convenience distributors covering 14 states in the South.  This group has been instrumental in the success of our company over the years.  Each year, they hold a tradeshow where the members and vendors …

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For several years, K3S has been actively involved with the Southern Association of Wholesale Distributors (SAWD).  This is a regional group of food and convenience distributors covering 14 states in the South.  This group has been instrumental in the success of our company over the years.  Each year, they hold a tradeshow where the members and vendors meet to discuss a range of topics and discover new offerings. 

This year, The SAWD is holding this show in Colonial Williamsburg, VA from June 11-14.  Once again, K3S is excited to attend.  This is a fantastic opportunity for us to connect with a large portion of our customer base as well as connect with new prospective clients.  

If you will be at the SAWD, stop by and see Michael and Dan! 

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K3S Welcomes Grocery Supply Company https://k3s.com/k3s-welcomes-grocery-supply-company/?utm_source=rss&utm_medium=rss&utm_campaign=k3s-welcomes-grocery-supply-company Wed, 03 Oct 2018 14:04:10 +0000 https://k3s.com/?p=454 Marietta, GA – King III Solutions, Inc. (K3S), a leading provider of inventory replenishment solutions, recently added Grocery Supply Company to the growing list of C-Store distributors using K3S-Replenish to manage their inventory. Since opening its doors in 1990, K3S has worked with C-Store distributors to develop and deploy effective inventory replenishment solutions. “We couldn’t …

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Marietta, GA – King III Solutions, Inc. (K3S), a leading provider of inventory replenishment solutions, recently added Grocery Supply Company to the growing list of C-Store distributors using K3S-Replenish to manage their inventory.

Since opening its doors in 1990, K3S has worked with C-Store distributors to develop and deploy effective inventory replenishment solutions. “We couldn’t be more excited to welcome Grocery Supply to the K3S family,” says King Harrison III, founder, and president of K3S. “They have tremendous presence and reputation in the industry and their people have been fantastic to work with.”

John Prickette is the Vice President of Sales at Grocery Supply, a full-line convenience store distributor located in Sulfur Springs, TX. ““K3S has an excellent reputation among C-store distributors not only for their software but also for outstanding service and support. Compared to our previous package, K3S offers several distinct advantages that will lead to increased inventory efficiencies, tremendous time savings and greater profits,” Schenk says.

K3S-Replenish gives distributors and retailers all of the tools they need to manage their inventory. This includes: accurate demand and lead-time forecasts, smarter ordering patterns, and automated forward buys. The software currently services distributors throughout North America and the Caribbean.

About K3S Inc.

K3S is a leading provider of advanced purchasing and replenishment solutions. Founded in 1990, K3S continues to pioneer new tools and techniques to assist companies in better inventory management. For more information on K3S, visit them online at https://k3s.com.

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K3S Attends the WSWA Convention https://k3s.com/k3s-attends-the-wswa-convention/?utm_source=rss&utm_medium=rss&utm_campaign=k3s-attends-the-wswa-convention Tue, 03 Apr 2018 15:46:14 +0000 https://k3s.com/?p=469 K3S has been extremely successful in helping Wine and Spirits Wholesalers control their inventory levels and boost fill rates. The tools available within K3S-Replenish successfully address the most common challenges faced by this industry including seasonality, combined trucks, splitting orders, and long lead times. In order to grow our presence in the industry, K3S will …

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K3S has been extremely successful in helping Wine and Spirits Wholesalers control their inventory levels and boost fill rates. The tools available within K3S-Replenish successfully address the most common challenges faced by this industry including seasonality, combined trucks, splitting orders, and long lead times.

In order to grow our presence in the industry, K3S will be attending the WSWA annual convention taking place in Las Vegas this month! If you are in attendance, stop by and visit us in booth 243.

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Are High Turns Killing your Profits? https://k3s.com/are-high-turns-killing-your-profits/?utm_source=rss&utm_medium=rss&utm_campaign=are-high-turns-killing-your-profits Fri, 07 Jul 2017 18:20:02 +0000 https://k3s.com/?p=480 For years, finding the most successful distributor was easy. All you had to do was look at the number of times each year they turned over their inventory. The more their inventory turned, the less they were paying in carrying cost. The less they paid in carrying cost, the more profitably they could operate. But …

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For years, finding the most successful distributor was easy. All you had to do was look at the number of times each year they turned over their inventory. The more their inventory turned, the less they were paying in carrying cost. The less they paid in carrying cost, the more profitably they could operate.

But during the 80’s, that began to change. As suppliers increased their minimum order requirements to reduce their shipping costs, it became increasingly difficult for distributors to enjoy the same level of turns they had always strived for and to which they had become accustomed. That certainly has not changed as we have moved into the 21st century.

To be clear, turns are definitely an important metric, but they are only one of many that your company should be concerned with. Only looking at turns is a bit like looking out the window, seeing the sun and assuming it will be a nice warm day. Meanwhile, the wind is blowing at 50 mph and the temperature is 18 degrees.

Does that mean it is harder to turn a profit since your turns have been dropping? Not necessarily. In fact, there are actually a few ways that decreasing turns may actually help you be more profitable! The key is finding those areas and taking advantage of them.

Here are 3 areas that could potentially mean a reduction in your turns, but an improvement in your bottom line:

Forward Buying

The first and most obvious way where you can decrease your turns, yet improve profits relates to items and times where it makes sense to forward buy. Let’s assume you turn your inventory 12 times each year, or roughly once per month. That would mean that at any given time, you have about a one-month supply of inventory in your warehouse on any given item.

If the supplier suddenly offered you a 25% discount on a few of their items, it may well make sense to buy some extra. It may take you 6 months to sell through that inventory. So you have effectively seen 2 turns on that item for the year rather than the 12 turns you had been accustomed to. However, because you bought it at a discount and sell it at the same price, the difference goes directly to the bottom line.

Discount Brackets 

With the intent of reducing shipping costs, suppliers will often offer price discounts if their customers purchase a full truckload rather than half a truck. On the surface, this could be counterproductive to the distributor. By purchasing the full truck-load from the supplier, you are effectively ensuring a reduction in your inventory turns.

That doesn’t necessarily mean it’s a bad idea, though. Just as with forward buys, in order to maximize profits, it’s important that a distributor constantly balance the opportunity for increased profit with the expense of carrying the extra inventory required to order the truckload.

Handling fees

The reality is, every time a truck comes into your doors, it costs you money. There is a cost associated with handling inventory. If you can reduce the number of trucks that arrive at your doors every year, you may well reduce the amount of labor associated with receiving, unloading, and sorting. Over the course of a year, this saving can be tremendous.

To be a successful distributor today may require a change in your thought process. Simply focusing on turns no longer ensures you the success it once did. Instead, distributors need to approach their purchasing with a strategy that focuses on squeezing every bit of profit out of your inventory possible. Sometimes that means a reduction in your overall inventory, sometimes it doesn’t.

If you are looking for was to increase your profits with your inventory replenishment strategy, then click below to find out how we can help you.

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Andalusia Distributing selects K3S-Replenish to manage their inventory https://k3s.com/adalusia-distributing-selects-k3s-replenish-to-manage-their-inventory/?utm_source=rss&utm_medium=rss&utm_campaign=adalusia-distributing-selects-k3s-replenish-to-manage-their-inventory Mon, 03 Jul 2017 14:27:38 +0000 https://k3s.com/?p=460 Marietta, GA – King III Solutions, Inc. (K3S), a leading provider of inventory replenishment solutions, recently welcomed Andalusia Distributing Company to the growing list of wholesale distributors using K3S-Replenish to manage their inventory. Billy Jones is the Director of Purchasing and Computer Operations at Andalusia Distributing, a full-line convenience store distributor located in Andalusia, Alabama. …

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Marietta, GA – King III Solutions, Inc. (K3S), a leading provider of inventory replenishment solutions, recently welcomed Andalusia Distributing Company to the growing list of wholesale distributors using K3S-Replenish to manage their inventory.

Billy Jones is the Director of Purchasing and Computer Operations at Andalusia Distributing, a full-line convenience store distributor located in Andalusia, Alabama.  ““K3S has a tremendous reputation among distributors not only for their software but also for outstanding service and support.  Their new pricing model makes it much easier for us to take advantage of their program”, Jones says.

Since opening its doors in 1990, K3S has worked with wholesale distributors to develop and deploy effective inventory replenishment solutions.  “We couldn’t be more excited to welcome Andalusia Distributing to the K3S family,” says King Harrison IV, Executive Vice President of K3S.  “They have tremendous presence and reputation in the industry and we’re really looking forward to working with Billy and his team.”

K3S-Replenish gives distributors and retailers all of the tools they need to manage their inventory.  This includes: accurate demand and lead-time forecasts, smarter ordering patterns, and automated forward buys.  The software currently services distributors throughout North America and the Caribbean.

About K3S Inc.

K3S is a leading provider of advanced purchasing and replenishment solutions. Founded in 1990, it continues to pioneer new tools and techniques to assist companies in better inventory management. 

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K3S Launches a modern new interface https://k3s.com/k3s-launches-a-modern-new-interface/?utm_source=rss&utm_medium=rss&utm_campaign=k3s-launches-a-modern-new-interface Thu, 01 Jun 2017 15:07:24 +0000 https://k3s.com/?p=464 Over the last 20 years, K3S customers have come to depend on the advanced mathematics in our software to help them effectively run their warehouse and stores.  Due to the fact we keep all of our customers on the same release, one of the unique advantages of being a K3S customer has always been having …

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Over the last 20 years, K3S customers have come to depend on the advanced mathematics in our software to help them effectively run their warehouse and stores.  Due to the fact we keep all of our customers on the same release, one of the unique advantages of being a K3S customer has always been having access to the most advanced tools in the marketplace.  This year, we are excited to announce an even greater benefit that our K3S-Customers can look forward to!  We will be releasing a new, modern interface to our software, called K3S-Replenish R6!

This project has been underway for several years and some of our customers had even gotten sneak-peeks at it over the years at the K3S-Users Conference.  We have now started to roll it out in actual customer environments!  This is a huge deal for several reasons including:

  1. It’s easier to learn:  By including “wizards” and helpful tips, customers have been able to learn R6 faster than ever before!
  2. It’s easier to navigate:  By “reimagining” the interface of K3S-Replenish, we were able to make the navigation through the system more intuitive.  All of the functions our customers have relied on are right there at the click of a button!
  3. It’s “future-ready.”  This interface is designed to be platform-independent. That means you could even do the purchasing for your organization on a tablet if you’d like!
  4. It’s more effective!  The tools used to build this interface allow us greater flexibility to highlight the areas of need in your organization.  By identifying these areas and providing tools to address them, R6 provides more immediate results!

For more information on how R6 can help your company, feel free to reach out to us!

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