Reducing Excess Inventory and Improving Service Levels for an E-commerce & Retail Leader

Challenge

A fast-growing e-commerce and retail player, operating across multiple sales channels (direct-to-consumer, marketplaces, wholesale), was experiencing serious inventory imbalances:

  • Excess stock of slow-moving SKUs, leading to high storage costs and risk of obsolescence.
  • Stockouts on key product lines, directly affecting customer experience and sales performance.
  • Lack of visibility and coordination between purchasing, sales, and supply chain teams, resulting in reactive replenishment and inefficient inventory planning.

The client’s objective: reduce excess stock, secure service levels, and optimize working capital across the product portfolio.

Diagnostic & Methodology

CoreChain launched a structured diagnostic, combining data analytics and stakeholder interviews.

Collected data:

  • Sales history per channel and SKU (seasonality, promotions, sales variability).
  • Inventory aging analysis (stock coverage, turnover rate, slow movers, excess & obsolete).
  • Purchasing parameters (MOQ, lead times, supplier reliability).
  • Service level targets by product segment.
  • Financial impact (working capital tied up in stock, storage costs, obsolescence write-offs).
Methodologies applied:
  • Lean inventory management principles (waste elimination, flow optimization).
  • ABC/XYZ segmentation and differentiated stock strategies.
  • Demand variability analysis and buffer stock modeling.
  • Risk analysis (FMEA) to identify vulnerabilities in supply continuity.
  • Benchmarking against industry best practices.
Solution Design & Recommendations

CoreChain defined a targeted action plan, including:

  • Redesign of inventory policies by product category, with clear stock coverage rules adapted to demand variability.
  • Implementation of dynamic safety stock models, calibrated to lead times and sales volatility.
  • Replenishment strategy optimization, integrating purchasing constraints (MOQ, lead times, supplier performance).
  • Financial scenario modeling to estimate savings potential per action lever.
  • Recommendations on supplier negotiation levers and order batch sizing.
Implementation Roadmap
  • Phase 1:

Quick wins — focus on top 30% of SKUs generating 70% of excess stock.

  • Phase 2:

Deployment of the new inventory management model across all categories.

  • Phase 3:

Integration of monitoring tools (Power BI dashboards, inventory health tracking).

Delivered tools:

  • Inventory monitoring dashboard (turnover rate, stock aging, service level).
  • Simulation templates for purchasing and replenishment planning.
  • Training sessions on inventory policy execution for procurement and supply chain teams.
Results & Impact
  • Inventory reduction of 22% across the full product portfolio within the first 9 months.
  • Over $3.5 million in working capital freed through optimized stock levels.
  • Service level improvement of +10 points on top-selling SKUs.
  • Reduction in storage and obsolescence costs.
  • Strengthened collaboration between purchasing, supply chain, and sales teams, with shared visibility on stock health and replenishment decisions.
  • Supply chain governance reinforced through clear processes and real-time data monitoring.

The right stock. The right place. The right time.