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Take control of low-value, fast moving industrial supplies with our managed inventory service.

Poor practices around inventory ties up your working capital and leads to waste around overstocking, obsolescence, poor availability and lost productivity.

Find out more information about our managed inventory solutions with our articles and video bringing these solutions to life!

 

Inventory Solutions by RS Components

ScanStock is a managed inventory service that enables customers to take control of their low-value, fast moving product requirements to deliver efficiencies and drive down costs.

Tackling product procurement pain points to achieve operational and cost efficiencies

Achieving the Holy Grail of an efficient operation will be a significant focus area for you, whether your organisation is in the manufacturing, or logistics and distribution arenas. And while IoT solutions are increasingly turned to in the quest to create efficiencies that deliver tangible benefits with a positive effect on the bottom line, going beyond this and back to basics in getting the foundations right when procuring high volume, low value components can yield significant savings and reduce operational challenges.

Recent research shows professionals responsible for indirect procurement and Maintenance, Repair and Operations (MRO) supplies face a range of pressures both on a day-to-day basis and at a strategic level. According to our own research, conducted in partnership with the Chartered Institute of Procurement and Supply (CIPS), the need to reduce operational budgets and inventory costs are the biggest pressures faced by procurement professionals today, cited by 55 per cent and 52 per cent (respectively) of survey respondents.

MRO professionals face pain points such as:
• Inventory mismanagement due to lack of control or no clear ownership of stores
• Engineering inventory kept in a single location, meaning it can be a significant distance from point of use
• Operations and engineering staff ‘booking out’ more than they need for the task to create their own ‘squirrel stock’, meaning total inventory investment is much greater than is required
• Limited reporting – many organisations purely transact re-stocking orders and fail to track who or what the parts or consumables are used for.
So with teams being pushed harder than ever to deliver savings, a coordinated supplier strategy is essential. RS Components is one of the largest distributors of industrial supplies, so we’re perfectly positioned to work with organisations to identify the issues faced by MRO professionals and get to the heart of their challenges. As a result, we’ve introduced inventory managed solutions to help overcome the pain points and assist you in streamlining your processes to bring infinite benefits.

We’ve worked on unique spend control solutions for putting buying in the hands of multiple users, while retaining the ability to track spend and generate data for reports that can inform future purchasing decisions. This, when combined with our managed inventory solutions to reduce off-contract spend, control pricing and reduce stock on site, can help you achieve optimum efficiency.

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ScanStock 
Our research in partnership with CIPs highlighted that 39 per cent of respondents are employing vendor-managed services as part of their MRO strategy, but that means there’s a large percentage still overlooking the importance of effectively managing MRO procurement. This may be because purchases in this category are often low value, but when low value items are bought in high volume, and the procurement process not streamlined - with multiple supplier invoices and a long source-to-pay chain - this can lead to a huge cost to your organisation. Add to this the losses incurred by poor procurement practices, including waste due to overstocking, obsolescence and production downtime from product unavailability, and it’s easy to see why this issue should be high on the agenda of any organisation with an ongoing need for industrial supplies.

This is why we developed our ScanStock solution. A managed inventory service covering the management and replenishing of stock, ScanStock effectively takes over MRO procurement, consolidating and simplifying the source-to-pay process - while improving inventory management. Outsourcing the task of MRO procurement will lead to both cost savings and reduce burden on the MRO professional, giving them more time to focus on other important operational areas and adding value to the business.

And they say you can’t buy time.

Let us do the legwork

One of the biggest barriers to addressing the MRO procurement process is the perceived hassle in identifying the organisational requirements, and the task of analysing consumption - or working with a lack of data.

Our ScanStock solution removes this legwork. We work with you in the implementation stages to make the process painless.

Stage 1 - Plan: We advise on your storage solutions, layout and configurations, and provide barcoding software
Stage 2 - Select: We help you select products and define suitable stock levels
Stage 3 - Check: We visit regularly to check and trigger restock orders
Stage 4 – Replenish: Our staff replenish the storage cribs on your site

A tried and tested, proven solution

Reaping worthwhile reward on any investment is often the key contributory factor when you’re considering outsourcing any business function. With ScanStock, you can rest in the knowledge that the solution has been tried and tested, and proven to generate significant benefits for businesses.

We’ve worked with many organisations to help them realise the benefits of our managed inventory services, and they are now enjoying the results.

PP Control & Automation, Europe’s largest independent supplier of control and automation solutions - based in the West Midlands - offers a complete outsourcing solution as well as assembling panels and machines for which it requires around 10,000 different components each year. With an ineffective procurement process and a need to improve inventory management, the firm was the perfect candidate for ScanStock.

“We were going through problems with our existing supplier, problems such as wrongly delivered items, inconsistent supply of products and too long to quote for parts,” explains Martin Allen, Commercial Manager at PP Control & Automation. “We must have those products available for use when we need them. Twenty-four hours is a long time if you consider that some of our products are supplied in around three days. In that context, losing 24 hours means a lot.”

PP, as a long-standing customer of RS, recognised our developments in value-added services and approached us to help – as we already had knowledge of their business and the breadth of range they required. To gain an understanding of how to help them on a strategic level, we spent time with the business, learning more about the operations and challenges.

The suggested approach was to consolidate suppliers, reduce duplication in source-to-pay processes and manage the fast-moving, low-value MRO supplies. We took over supply of the commodities using ScanStock, and now manage around 800 SKUs on lineside Kanban cribs, and conduct twice-weekly visits.

The bespoke barcode-based replenishment report we developed allows PP Control & Automation to scan line orders into their MRP system – therefore removing keystrokes, saving time and increasing accuracy. As the RS rep working with PP is based in a local RS branch, decisions and deliveries can be made quickly, negating unnecessary and costly delays.

“Our relationship with RS has been through that local connection. We’re reliant on those people understanding what we want,” says Allen. “The fact that it’s coming out of the local place was great. It means something to the people at the branch in Birmingham. We aren’t just a number. Our rep Luke is basically a member of our purchasing team. He’s recognised here and we appreciate that human interaction.”

With ScanStock in place at the firm since the start of 2018, PP Control & Automation has reduced both the ordering process time and operational downtime. For Allen, it is about more than cost saving: “The cost of not having the product is far greater than the pence you would pay to actually have it. For the want of a nail, the kingdom was lost, as the saying goes.”

Recouping time translates into tangible savings

PP Control & Automation is not alone in its positive experiences of ScanStock. Corby-based Mace Industries, a manufacturer of conveyor-belt or chain-driven movement solutions, has saved significant time in its ordering process and reduced operational downtime, allowing its employees to focus their time on other areas of the business. This has translated into a saving of £11,672 over the year (based on annualised savings over five months) with total cost of ownership savings representing 28 per cent of total product spend.

“I can largely leave this side of the business alone, which means my time and the resulting cost of that is saved,” says Chris Peck, Purchasing Manager at Mace Industries. “From a productivity point of view, ScanStock has helped massively – our engineers know exactly where all the products they need will be and that they will never be scrambling around for key parts, which could delay our operations.”

It is clear that the overriding result of using ScanStock is the value derived from diverting staff time to more useful and value-adding activities than focusing on stock levels. When employing this as part of an MRO procurement strategy, there’s no limit to the benefits an organisation can achieve.


Purchasing Manager
While indirect costs may be considered an inevitable part of procurement, the time involved in researching and checking product availability, negotiating pricing and arranging delivery - coupled with seeking internal approval, issuing purchase orders and processing invoices and payments - means the total process cost for each purchase order is £80, as calculated by The Chartered Institute of Procurement and Supply (CIPS). With businesses raising hundreds or thousands of purchase orders a year for low-value products, this is a significant hidden cost.

Our PurchasingManager e-commerce controlled spend solution helps customers drastically reduce this figure by automating large sections of the purchasing process, allowing staff to place their own orders, under specified controls.

The web-based order management tool is customisable and involves no investment or IT upgrade requirement. It gives customers with many order placers strong spend control, approval, tracking and reporting capabilities – features that are virtually unrivalled by any other e-commerce platform. It is a versatile solution that can be installed in businesses large and small, providing a level of functionality that wouldn’t otherwise be achievable without significant investment in a large, costly, purchasing system.

Benefits delivered by using Purchasing Manager include:
• Increased control over orders and spend
• Time savings
• Enhanced visibility
• Improved reporting
• Speedier processes
• User-friendly, providing quick access to more than 600,000 items at RS
Confectionery giant achieves giant savings with PurchasingManager

When a well-known confectionery manufacturer decided they needed to streamline their ordering, having been a long-established customer of ours, purchasing products ranging from Personal Protection Equipment (PPE) to electrical and automation products, we worked with them to determine a solution. Identifying that each PO raised incurred a £74 cost to the business - with 200 orders annually being made with RS alone – it was clear that significant cost savings could be achieved for this customer with the right approach.

PurchasingManager provided the simplest way to remove the lengthy process stages, empowering engineers to place their own orders under an approval process with a monthly blanket PO, reducing the £74 PO cost down to £46. The company consolidated orders with us, increasing them to 1,089 annually, creating savings of £30,492 based on the new cost per order.

PurchasingManager can be used as a standalone solution or in conjunction with ScanStock, providing a door opener to greater stores and inventory management efficiencies for those organisations that will benefit from the combination solution. This was the case with a utilities company in southern England, which had a high volume of remote end users procuring low value goods through various trade counter networks across the region. This lack of spend control was resulting in erratic, random purchases, causing quality and traceability issues. Moreover, when different widgets are being fitted to the same machinery, there is no opportunity to leverage economy of scale.

Our solution was to build an inventory hub for them, using our ScanStock tool for some of their fast-moving, low-value items, and rolling out PurchasingManager across all their end-users, restricting where their purchasing cards can be used.

By taking a holistic view of the indirect procurement process, we can offer solutions that save quantifiable amounts of time – and, therefore, money.

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