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By efficiently managing their purchasing inventory, businesses can ensure that their funds are utilized to purchase the most needed items. However, identifying and addressing excess and obsolete inventory has often been a cumbersome process, relying on spreadsheets and manual calculations. Fortunately, with the advent of the Purchasing Inventory Effectiveness Action platform, companies can streamline this process and improve their overall inventory management practices. Nirmalya’s Purchasing Inventory Effectiveness platform, integrated within the Nirmalya ERP (NERP) system, offers invaluable insights to facilitate optimal inventory management. By leveraging this platform, companies can assess the performance of their buyer-planners across commodities or product lines using ratios rather than absolute values or on-hand quantities. This objective approach allows for a more accurate evaluation of inventory purchasing effectiveness, ultimately leading to enhanced profitability.

Nirmalya Dashboard offers comprehensive analytics that empower managers and users to monitor key metrics and Key Performance Indicators (KPIs). Within the Purchasing Effectiveness platform, several KPI highlights play a pivotal role in assessing inventory performance.

  • One crucial metric to consider is the obsolete and excess inventory ratio by item. Ideally, obsolete and defective items should constitute only a small portion of the on-hand inventory. By identifying items with poor performance in this aspect, managers can take proactive measures to improve overall performance. Such steps may involve curtailing future purchases, depleting excess inventory through sales, or scrapping defective items. While a higher reserve against obsolete inventory may temporarily mask the issue, it can ultimately hinder the company's profitability.
  • The combination of a bar chart and a line chart in this metric enables a visual representation of the ratio of obsolete and defective inventory to the total inventory managed by each buyer-planner. This visualization is instrumental in identifying buyer-planners who excel in their buying policies and processes. By implementing their best practices as standard procedures, businesses can enhance overall effectiveness. Moreover, this metric can uncover commodities where current buying policies are inappropriate or highlight deficiencies in product life-cycle management.
  • Similar to the previous metric, this chart focuses on the ratio of obsolete and excess inventory to total inventory, but measured by value instead of quantity. By evaluating buyer-planners based on their ability to produce superior results, businesses can refine their processes and potentially adjust buying policies. It is important to note that high-value items can skew this chart's interpretation, so it is best utilized with items of similar value or when analyzing the ratio rather than absolute numbers.

Managing inventory purchasing effectively is paramount for businesses striving to maximize profitability. The Nirmalya Purchasing Inventory Effectiveness platform, integrated within the NERP system, offers invaluable insights to optimize buyer-planner performance, inventory replenishment policies, inventory reserves, and product lifecycle policies. Leveraging the power of comprehensive analytics and KPIs provided by the Nirmalya Dashboard, businesses can streamline their inventory management processes and drive sustainable growth.


The effectiveness of purchasing inventory plays a vital role in a company's profitability. With the Nirmalya Purchasing Inventory Effectiveness platform, businesses gain access to critical insights and analytics to optimize their inventory management practices. By effectively managing excess, obsolete, and defective inventory, companies can allocate their funds towards the most crucial items, maximizing profitability and ensuring long-term success in today's competitive market.

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