In 2002, John Deere’s $4 billion commercial and consumer equipment division implemented supply chain management software and reduced its inventory by $500 million. As sales continued to grow, they have been able to keep their inventory growth flat. How did the supply chain management software implementation allow them to reduce inventory on hand? How did this allow them to save money? Which income statement accounts (e.g., revenue, cost of goods sold, SG&A expenses, interest expense, etc.) would this affect?
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