Home Depot Logistics
Please Google Ziobro, P. ¥tailers Embrace Barer Shelves SJ June 28, 2016. It is an article about reducing
safety stock and turning inventory faster, seemingly triggered by the issue of servicing internet demand and store
demand. So Home Depot plans to put the store back in store by placing all of its local inventory out on the store
shelf and replenishing it more often.
It works like this. A large Home Depot store sells 100 fence posts on Monday, Tuesday, Wednesday, Thursday,
Friday, Saturday and Sunday: 700 a week every week of the year. Currently to serve this demand (do not consider
safety stock) a truck delivers 300 posts on early Monday morning and another 400 fence posts on early Thursday
morning before the store opens. The regional Home Depot Center sends seven trucks twice a week (on Monday and
Thursday) to the store to deliver the fence posts and a lot of other inventory.
It is proposed to change delivery to a truck every day to the store and this way 100 fence posts a day can be
delivered early in the morning to the store by a truck.
1.
What is Home Depotàsaving in average inventory of posts carried overnight. This average applies to
every day of the week for every week of the year.
2.
What is Home Depotàsavings in annual average inventory carrying of posts if it costs $20 a year to carry a
post in inventory in the store?
3.
What is being synchronized in this change in process?

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