Furniture Companies Build Success with Inventory Optimization Solution

Manufacturers Natuzzi, Hettich and Targetti select software from ToolsGroup to lower costs, reduce inventory

Manufacturers Natuzzi, Hettich and Targetti select software from ToolsGroup to lower costs, reduce inventory

Milan, Italy, and Boston — January 11, 2006 — Gruppo Natuzzi, a manufacturer and retailer of sofas and armchairs, said it has been using ToolsGroup's DPM for several years to manage its furniture parts inventory. Building on the success of that project, Natuzzi recently chose to employ DPM to optimize its furnishing accessories.

With high-ticket inventory and many product variations, furniture manufacturers face a constant struggle to maintain high customer service levels while keeping inventory costs in check.

Pietro Gallotta, Information Communication Technology manager at Gruppo Natuzzi, explained: Pleased with the results we obtained with ToolsGroup, we have decided to extend our use of DPM technology to facilitate better management of the entire range of accessories, such as lamps, coffee tables and carpets. These items constitute an integral part of Natuzzi's rich lounge catalog, and are considered to be of strategic importance for the group's continued market expansion.

ToolsGroup said its DPM solution is also being used by such furniture manufacturers as Hettich and lighting companies like Targetti, both of which have reported positive results from the software.

Hettich Iberia, part of the German group HETTICH, manufactures and distributes ironwork for furniture. At Hettich, DPM manages 15,000 individual items in the central warehouse. After just three months of using DPM, Hettich said it increased customer service from 78 to 92 percent, reduced inventory levels and increased sales (due in part to the higher customer service level). And also important to Hettich, a culture of planning was instituted, transforming the company's ability to execute against strategic objectives.

Lighting leader Targetti Sankey manufactures and distributes more than 3,000 technical and decorative lighting products in more than 70 countries. Targetti said it chose DPM because of its unique technology for stock mix optimization and service level planning. In addition, DPM has integrated multiple inventory, demand and replenishment planning processes for Targetti onto the same software platform.

— A logistics team is called upon to craft supply chain processes that update logistics and inventory management at the growing retail chain Michaels Stores Inc. Read more in "The Art of Supply Chain Optimization," a Best Practices article in the October/November 2005 issue of Supply and Demand Chain Executive.