Inventory Asset Management Program Turns One

By Andy Reese
February 4, 2005

Clients of joint offering from Choice Logistics, System Design Advantage said to be seeing inventory reductions, higher in-stock ratings

Mission-critical spare parts specialist Choice Logistics has marked the first anniversary of its Inventory Asset Management (IAM) program, launched in January 2004 in conjunction with System Design Advantage (SDA).

IAM is a parts pooling program whereby SDA-owned inventory is stocked in Choice Logistics locations across North America and is made available to information technology service providers for local, same-day service requirements. (See article on the program's launch.)

"Over the past year, IAM has expanded its appeal and adoption by major service organizations by offering an immediate impact to lowering inventory levels and increasing parts availability," the two providers said in a statement.

Companies that have implemented the IAM solution include BancTec, Sarcom and Unisys, among others. Lee Micks, director of major accounts operations for BancTec, said that the IAM program had an immediate impact on his company's bottom line and gave BancTec a unique opportunity to advance its services by improving cash flow and decreasing costs.

"We can attribute a significant portion of our growth over the last year to IAM," Micks said, "an indicator that this model is working successfully. Overall, IAM gives BancTec a competitive edge in the enterprise service marketplace."

"We are thrilled with the success clients are experiencing as a result of our partnership with SDA and last year's launch of the IAM program," said Michael Katz, chief executive officer for Choice Logistics. "Clients are benefiting from marked reductions in inventory, as well as the associated cost savings and customer satisfaction improvements."

The two providers said that the IAM offering provides a competitive advantage by reducing overall service delivery costs, giving companies the ability to quickly expand into new markets through direct and indirect inventory sourcing and procurement channels, repair or replace and replenishment services, as well as order fulfillment and logistics services.

"Companies currently tapping IAM are 99.9 percent assured that the right part will be in the right place at the right time across the entire service supply chain," the two providers said in a statement. Other benefits that clients have experienced, according to the providers, include 50 percent-plus reductions in inventory, and 99 percent-plus in-stock ratings.

Jim Sahli, CEO for SDA, said, "By staying focused with our offering and expanding our parts network, SDA is achieving its goals of lowering our customer's inventory while providing increased availability of same-day parts."

As part of the IAM offering, clients have access to:
• Choice Logistics' logistics and IT infrastructure, which includes same-day availability, real-time control and global visibility, as well as a client support organization;

• SDA's advanced emergency spare parts distribution services, depot repair facility, worldwide presence and partnerships;

• Asset management marketed to companies through their collective channels and beyond;

• Relief of operational expenses and any future burden of inventory management; and,