OPTIMIZING INVENTORY MANAGEMENT IN THAI PRODUCTSWAREHOUSE: SKU RATIONALIZATION GUIDELINES FROM ATRAVEL RETAILER PERSPECTIVE

Abstract

This study addresses inventory management challenges in a travel retail company, where a  recently expanded warehouse reached full capacity within two years. The research investigates  the root causes of the storage issue, identifying excess stock and ineffective SKU (Stock Keeping  Unit) management as primary contributors. The paper proposes a systematic approach to SKU  rationalization aimed at optimizing inventory, reducing costs, and improving turnover rates  without negatively impacting customer satisfaction. The methodology integrates data-driven  analysis of profitability, sales rates, and inventory turnover to guide decisions on retaining,  discontinuing, or reassessing products. 

The findings demonstrate that SKU rationalization can enhance inventory control, streamline  product assortment, and align stock levels with consumer demand, thereby improving  operational efficiency and profitability. While the study provides actionable insights for  managing the Thai Products category in travel retail, its applicability to other product  categories warrants further exploration. Recommendations are made for implementing  targeted SKU reduction strategies to balance inventory optimization with customer service  requirements, contributing to more effective supply chain management in retail contexts.