July 17, 2024

Mckerrinkelly

Inspired By Shop

Plant-Powered Health Brand Cuts Back $1.5M of Excess Stock With Inventory Planner

5 min read

Key facts

  • Shopify Plus-powered omnichannel merchant specializing in organic plant-based protein powder, with 2,100% YoY growth
  • Uses Inventory Planner to accurately forecast demand, optimize stock holding and as a crucial cash flow planning tool
  • Impact: $1.5M of excess stock eliminated and holding stock cut in HALF – inventory has shrunk but profit has grown

“Inventory Planner is a tool that unlocks the ability to make smarter, faster decisions when it comes to our biggest investment: inventory” – Kevin Dalaeli, President and COO, Kos

“In today’s environment, who wouldn’t want a million dollar cash buffer?” – they’re the words of Kevin Dalaeli, President and COO, at Kos – a plant-based protein and superfood company from the US.

And it’s hard to disagree. 

Economic downturn, rising costs, supply chain issues, war in Ukraine and wavering consumer demand over the last 12 months have all hit retailers where it hurts – in their cash flow. 

But Kos, which has shot to success in the wellness industry with a staggering 2,100% growth rate, has found an antidote to cash flow woe: Inventory Planner.

Inventory Planner is the top-rated inventory planning app that helps startups and big brands reliably forecast sales demand and get hassle-free buying recommendations, alongside powerful inventory insights that save money and time. 

It reveals which inventory to order, how much to order, and the perfect moment to order it, based on an accurate calculation of how much you will sell that factors in supplier timescales, seasonality and promotions alongside historical sales data. 

Going Against The Green

“We’d been seeing great success and rapid growth and, while that was happening, inventory became a problem that bubbled up to the surface,” Kevin says. 

“We were previously using Google Sheets to manage our inventory and I knew we needed a better, more intuitive solution. 

“Like most brands, inventory is our biggest investment – and managing it well is critical for our cash flow.

“I discovered Inventory Planner and I realized what a powerful yet simple tool it is. We set it up and started plugging away – and the more we used it, the more we fell in love with it.

“I’ve worked in retail for many years and I’ve seen the good, bad and ugly of how inventory is managed. Inventory Planner is the best tool on the market for businesses that want to get it right.”

Kos was launched after its founders, Allan Stevens and Tony Stahl, spotted a gap in the market for vegan protein powder that tastes great. Its initial range was sold primarily via Amazon, but after rapid growth on the marketplace, Kos expanded into the DTC and retail space. 

The business now operates a successful Shopify Plus webstore and is listed with retailers across the US, including Whole Foods, Target, and Walmart as well as selling via Amazon. Its impressive 2,100% year-on-year growth triggered investment from the likes of Whole Foods’ former CEO Walter Robb, and Horizon Bank’s chair Jim Schneider. 

Planting The Seeds Of Success

Thanks to Inventory Planner’s powerful infights, Kos has released £1.5M from excess stock – which has been reinvested in growth and kept back as a buffer against the turbulent current retail landscape. 

Crucially, while Kos’s inventory shrunk, its sales grew – moving the brand closer to its goal of operating a negative cash conversion cycle.

Kevin says: “Using Inventory Planner, we were able to cut out ‘days of outstanding inventory’ in half – which freed up around $1.5M. 

“In today’s environment, who wouldn’t want a million dollar cash buffer?

“There’s a storm raging in retail right now – nobody knows what’s going to happen; it could get better, it could get worse, so it’s vital to have some cash in reserve so you can weather whatever comes next. 

“If your inventory has expiration dates, which ours does, the risk of excess stock is especially high. Many suppliers will only buy from us with an 18-month expiration date, so if we aren’t turning over our stock every six months, we’re in trouble. 

“Inventory Planner ensures we get the balance just right. 

“After all, every dollar we spend in inventory counts. If you spend it on the wrong things, you tie up cash you can’t spend anywhere else – and having too much stock is as bad as having not enough. 

“Say you spend $100K on ‘safety stock’ that then becomes obsolete and has to be binned or liquidated… That’s $100K you could have spent on an employee that would have brought in $500K. That’s a huge opportunity cost.”

Food For Thought

As well as revealing which inventory to order and when to order it, based on an accurate calculation of how much you will sell, Inventory Planner offers customized, granular insight and notifications across various KPIs, including variant, vendor, warehouse and product category. 

Kevin says brands should be using these insights to shift from the mindset that inventory is a ‘cost center’ to thinking of it as a ‘profit center’. 

He adds: “Inventory Planner is a tool that unlocks the ability to make smarter, faster decisions when it comes to our biggest investment: inventory. 

“I’ve heard about too many brands – some of them eight or nine figures – who have sold themselves short by around 30% in the last year because they aren’t planning their inventory properly. 

“Their leadership insists on managing their inventory in spreadsheets, purely because that’s what they are most comfortable with, so brilliant brands end up being hamstrung by a lack of process and a lack of tools. 

“I like to think of Inventory Planner as my Swiss Army for all the day-to-day troubleshooting and planning for the business.”

“I’ve worked in retail for many years and I’ve seen the good, bad and ugly of how inventory is managed. Inventory Planner is the best tool on the market for businesses that want to get it right.” – Kevin Dalaeli, President and COO, Kos

With consumers increasingly enticed by the health and environmental benefits of a vegan way of life, the $10 billion plant-based market is expected to continue to grow – and, with Inventory Planner in its toolkit, Kos is perfectly placed to seize every opportunity that comes its way. 

Kevin says: “We’re seeing explosive retail growth. We’re approaching more than a hundred thousand total points of distribution in retail and we’re also a digital-first business, so we’re gaining there, too. 

“For us, the future is all about being able to stay nimble and to build steadily while being ready for the next digital wave. Inventory Planner will continue to play a key part in that.”

The post Plant-Powered Health Brand Cuts Back $1.5M of Excess Stock With Inventory Planner appeared first on Retail Minded.

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