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It turns its inventory 75 times a year compared to 24

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Unformatted text preview: s moves forward automatically, keeping Dell’s costs and inventories very low. It turns its inventory 75 times a year, compared to 24 times for its industry, and its receivables turnover of 11 times is also high— twice the industry’s. Supply chain software, which is now migrating to the Internet, is becoming essential for most companies. It brings together and automates a company’s order-taking, purchasing, inventory management, and payment processes. A well-designed system shortens product cycle times by helping to anticipate demand, finding suppliers to provide materials on time, and identifying the least costly delivery method and routing. Because companies’ needs and specific business processes differ widely, implementation can be difficult. Compare Dell and Lipton Tea, for example. Both could probably use a supply chain application’s standard procurement module for basic office supplies, but 605 In Practice ordering Dell’s computer parts requires a different model from Lipton’s....
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