Irish beer case

Logistics Case Study: Introducing Co-Managed Inventory at Guinness GB Guinness was seeking lead time reduction of their inventory to reduce costs and therefore maximize profits. Keeping high inventory levels of stout, draft and other types of beers would allow them to have rapid responses when the product would be needed, by keeping stock available. At that time, CMI and VMI were two of the possible options to achieve this objective, derived from ECR initiatives. ECR …

…with little participation of the sales and marketing teams who needed timely information for promotions, price setting, and forecasting. Management and purchasing as well should take active part in the CMI plan to be able to use this information to improve their objectives. Finally, another aspect overlooked by Guinness was that they were focusing on inventory more than on demand. If plans to enlarge demand were considered maybe reducing inventories wouldn't have been that important.