CASE STUDY : Rosewood Nursing Homes selects only the very best supplies from companies that exceed standards using high quality materials suitable for their clientele.

With a state-of-the-art facility and the highest quality of customer care, Rosewood is able to assist clients on or off their site whether they are requiring full time high-level care, low-level care of for some clients, at home care.

ABC Pty Ltd is the founding company of Rosewood. Rosewood was established in 2002 to provide care for elderly clients at all these levels.

Based in Victoria, Rosewood are Australian renowned for their exceptional care facilities.

Rosewood is well known for providing outstanding in-home care service, to a range of clients, who prefer to stay at home while they ca. this is a relatively new concept for nursing homes to enter into.

Together with all of these services that Rosewood Nursing Homes can offer, they provide a level of service that is hard to match.

ABC Pty Ltd and Rosewood Nursing Homes have an accounting system already in place, but no inventory or job management system. As there was no inventory management system in place, there was no visibility of cashflow, or inventory wastage. Even purchase orders were done on paper. One of the owners both companies, said that without an integrated system, and visibility of the businesses high value stock items, the business didn't have 'sustainability to grow'.

Using their old system, the companies were facing problem to keep track of their inventory and purchase orders. Another issue that the company was confronting was an inadequate data base in the company and it could compromise their reputation as a leader in quality care, if they can not maintain their supplies at the highest levels

These systems and processes were halting their progress as they were not able to keep track of the stock that they have currently on hand. Another problem that the company can face due to extra stock is that if the technology changes then the company might suffer huge losses.It was clear to the owner of the company after going through the performance reports that these practices were not sustainable for the growth of the company.

So, they decided to install inventory management system to help maintain their reputation as being one of the best quality care leaders in community services. Performance reports

Year	Income	Inventory on hand		Profit	Variance
2010	$1.5 million	$300,000		$500,000	$700,000
2011	$1.9 million	$380,000		$600,000	$920,000
2012	$1.7 million	$500,000		$350,000	$850,000
2013	$1.4 million	$200,000		$350,000	$850,000
2014	$1.9 million	$250,000		$700,000	$950,000

The company looked at other systems, and came to a decision to monitor the performance andsustainability of new inventory management systems. They wanted to choose a system that could analyse supplies, operational and service delivery systems.

To choose the best options for inventory management and e-commerce business software, the owner of the company has allocated you the task to review programs, systems and processes and prepare a report for them also provide recommendation so that they can choose the best option available. 1. THE SOFTWARE MUST automatically collect your advertising data from ALL advertising platforms & matches it with conversion data to let you analyse and report ROI. No more spreadsheets and manual importing of cost data.

2. A B2B eCommerce website that provides a 24/7 online ordering destination for your B2B customers.

3. A software that has all-in-one cloud Inventory, POS, B2B, EDI and 3PL.

IDEAS SO FAR: Cloud-Based Inventory Management - These systems offer real-time tracking of inventory levels, sales, orders and deliveries. They can be assessed from anywhere, providing flexibility and convenience. Examples include Zoho Inventory and Quickbooks Commerce.

• AI-Driven Inventory Management - Artificial Intelligence (AI) can predict future sales trends based on historical data, helping Rosewood to optimize stock levels and reduce storage costs. AI can also automate routine tasks, freeing up staff for more strategic work.
• RFID Technology - Radio Frequency Identification (RFID) can track products in real-time, providing accurate and up-to-date inventory data. This can reduce errors associated with manual counting and help prevent stockouts and overstocking.
• Integration with Other Systems - An inventory management system that can integrate with other business systems (like CRM, ERP, or eCommerce platforms) can provide a more holistic view of the business and streamline operations.
• Mobile Access - A system with a mobile app or mobile-friendly interface can allow staff to access inventory data on the go, which can be particularly useful for businesses with multiple locations or warehouses.
• Customisable Reporting - A system that offers customizable reports can help Rosewood to track the metrics that matter most to them, aiding in decision-making and strategic planning.
• Vendor-Managed Inventory (VMI) - In this model, suppliers manage inventory levels based on agreed-upon parameters. This can reduce the burden of inventory management for Rosewood and help to ensure a steady supply of products.
• Consignment Inventory - Rosewood could consider a consignment inventory model, where they only pay for inventory once it's sold. This can reduce upfront costs and financial risk.
• Dropshipping - If Rosewood sells products online, they might consider a dropshipping model, where products are shipped directly from the supplier to the customer. This eliminates the need for Rosewood to manage inventory altogether.
• Just-In-Time (JIT) Inventory - This strategy involves ordering inventory as needed, reducing storage costs. However, it requires accurate sales forecasting and reliable suppliers.
• The two-bin system - is a simple and effective inventory management method. When the first bin is empty, it provides a visual signal that it's time to reorder, while supplies in the second bin are used during the reorder period. This helps to prevent stock-outs and ensures a continuous supply of items. However, the system requires careful monitoring and prompt reordering to avoid delays. If reordering is not done promptly when the first bin is empty, the second bin may run out before new stock arrives, leading to stock-outs. Therefore, while the two-bin system can be very effective, it relies on careful management.
• Ordering cycle system - The advantages of regular inventory reviews include better inventory control as it allows businesses to keep track of what's in stock and what's not, thereby preventing overstocking or understocking. It also improves cash flow management as businesses can avoid tying up too much capital in inventory. Regular reviews also enable businesses to identify and address issues like slow-moving items or discrepancies in inventory records promptly. However, the downside is that there's a potential risk of stock-outs between review cycles. If sales are higher than expected, items may run out before the next review, leading to lost sales and customer dissatisfaction.

TO DO:

• Considering that the approved idea has the following benefits:
• Accurate inventory levels and locations
• Increased efficiencies
• Improved customer service

The benefits specified above will lead the company to have growth in its sales by 15% in next 2 years and an increase in net profit of yearly 12%.

The cost implications to implement the new inventory management system is $2.5 million.

There are certain risks associated as well:

• For the outdated products due to technological advancements, the shelf life has increase and poses an inventory control risk.
• All products go through the following phases of market; introduction, growth, maturity, decline and withdrawal. Inappropriate handling of inventory management system will need to consider these facts otherwise the business will incur losses.

Undertake risk management and cost-benefit analysis for approved idea considering the above benefits and risks and complete the report template given below suggesting whether the company should implement the new inventory management system based on the outcomes from cost benefit analysis and risk management, submit it to the trainer via email and get approval. Assessment task template

Report on outcomes of cost-benefit analysis and risk management

Main body of the report covering following Topics in appropriate details

• Cost benefit analysis
• Risk management analysis