On today’s episode, Kunle is joined by Axel Bukowski, Co-Founder & CEO of Madden Analytics, a tool that creates a systematic inventory for brands to provide data for better business decision-making.
It’s an insightful episode as you’d hear Kunle and Axel talk more about product inventory, the fashion industry, the trend of product demand, nearshoring, and solutions to inventory and forecasting problems.
Here is a summary of some of the most important points made:
There has been a major shift in brands’ focus from growth to profitability and cashflow.
Inventory planning is a huge part of profitability and cashflow.
Three reasons why the fashion industry has a problem with efficient inventory planning are production lead times, seasonality of products, and size variations.
“It’s estimated that up to 30% or even, by some estimates, up to 40% of all the clothing items produced annually are never sold because there’s no demand for it.”
“The more historical data you have on sales and inventory, the more accurate predictions and forecasts you can make going forward.”
Timestamps:
05:15 – Axel’s backstory
19:48 – Macrotrends in Inventory planning
23:49 – Nearshoring
27:36 – Changes in demand and its effects on inventory planning and supply chain
34:17 – The fashion industry
38:59 – Efficiency in planning inventory
47:35 – Forecasting accuracy
51:27 – Madden Analytics and profiling
53:43 – Best practices
Takeaways:
Nearshoring is one of the bigger themes discussed by different brands in the past few years.
According to a report on the Nordics that researched 100 to 200 big companies, after the Ukraine-Russian war in 2022, inflation took off and companies started to discount a lot.
“Managing your inventory and your potential overstock is usually a quite long process. There’s no single initiative that you can make in 1 week or 1 month to get rid of all your overstock.”
“Moving more and more towards permanent collections, classics, carryovers, never-out-of-stock, that’s a good thing for brands in specific and for the industry as a whole and the environmental impact of the business as well.”
Cashflow is the most important part of a business, especially consumer types of businesses and one of the best ways to achieve it is having efficient and smart inventory planning.
Hope you enjoy the episode!
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