Supply Chain Inventory Dashboard

Inventory Optimization Dashboard for KEEN

Situation Analysis

KEEN Footwear currently holds an average Days Sales of Inventory (DSI) of 202 days, significantly higher than key competitors Nike, Columbia, and Adidas, whose DSIs range between 107 and 157 days. Specifically, KEEN’s Work Boot category has an exceptionally high DSI of 292 days, representing nearly 10 months of stock. High inventory levels appear driven by extended lead times, averaging over 200 days, resulting in precautionary ordering practices and excessive safety stock.

Value Provided by Dashboard

This dashboard clearly identifies critical inventory inefficiencies and quantifies potential financial improvements from inventory optimization:

  • Immediate Cost Reduction: Lowering KEEN’s average DSI from 202 to an industry-conservative benchmark of 150 days would achieve immediate storage and holding cost savings. For example, reducing inventory from the current level of approximately $2.25 million to $1.70 million (if DSI reaches 110) can generate estimated savings of over $550,000.

  • Improved Cash Flow: By identifying KEEN’s low inventory turnover rate of 2.50—well below the targeted benchmark of 4.0—the dashboard highlights the opportunity to significantly increase cash availability and reduce working capital tied up in inventory.

Actionable Recommendations

  • Targeted Inventory Reduction:

    • Phase down or offer strategic discounts for Work Boot inventory.

    • Adjust demand forecasts and reduce reorder quantities to align closely with actual market demand.

  • Lean Inventory Management:

    • Transition to Economic Order Quantity (EOQ) and demand-driven replenishment models to avoid overstocking.

    • Explore phased shipments to mitigate overstock risks without sacrificing product availability.

  • Supply Chain Agility:

    • Negotiate lead time reductions of 30–50 days, directly lowering safety stock needs and inventory costs.

    • Benchmark practices against industry leaders (e.g., Nike’s turnover rate), aiming to increase turnover from 2.5 to at least 3.5, thus significantly improving KEEN’s competitive inventory efficiency.

This dashboard enables KEEN to clearly visualize inventory challenges, measure potential savings, and strategically implement data-driven actions to enhance supply chain performance, reduce costs, and improve overall business agility.

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