TULSA, Okla. -- Affiliated Food Stores here has moved 20% of its suppliers onto a new purchasing and inventory system, with the balance expected on line by the beginning of the second quarter of 1997.
Affiliated's goal is to achieve a 10% reduction in inventory within six months of bringing all suppliers on board, said Robert Rippley, president and chief executive officer.
"This purchasing system orders product when it's necessary to order, not necessarily on prescribed days like buyers are traditionally used to using," Rippley said. "This is a major factor that contributes to inventory reduction and provides more just-in-time inventory."
Another benefit of the system is that it significantly reduces the time a buyer spends on the mechanical aspects of purchasing. As a result, the buyer has more time to spend on merchandising and category management, he added.
Rippley also noted that the forward buying part of the software allows his company to specify investment levels and the system will maintain them. The system, from E3 Associates, Marietta, Ga., prescribes the exact amount of inventory it is necessary to purchase in order to maximize the return on investment.
In addition, Rippley noted, service levels are more adequately maintained because different levels can be set for various products. For example, the system can be set to ensure the warehouse is never out of stock on items designated as top priority, while lower priority products could be maintained at service levels below 100%.