STANDARD OPERATING PROCEDURE

TITLE ISSUE NUMBER

Inventory Ageing

WRITTEN BY EFFECTIVE DATE

Acquisory Consulting LLP

APPROVED BY: SUPERSEDES

AMENDMENTS TO PREVIOUS VERSIONS

Page No. Context Revision Date

PURPOSE
To lay down a procedure for monitoring of inventory ageing.

INPUT FROM OUTPUT TO

Planning team Sales & Marketing Team

PROCESS MAP

PROCESS ROLE DEPARTMENT

Sourcing Director Sourcing & Planning
Sales Director Sales Team
Table of Contents
1. Review of Stock Ageing .............................................................................................................................................3

SA 1 - preparation of stock ageing report ....................................................................................................................3

SA 2 - Review of stock ageing.......................................................................................................................................4

1. Review of Stock Ageing

Process Flowchart

Start

No
SCM Team
Sourcing & Planning Sourcing & Planning Sales at negative
Download Stock Ageing Is Quantity
Review stock ageing Check MOQ and lead margin post approval
from SAP and send to saleable?
more than 180 days time from CFO
Sourcing & Planning

Yes

Select suitable channel

End
for sales

Roles and Responsibilities

Activity WUSA TAT

Dept. Responsibility

Extract stock ageing report SCM Deputy Manager Monthly

Review of stock ageing Sourcing & Planning / Monthly

Sales Sourcing Director

Preparation of plan for liquidation Sourcing & Planning / Sourcing Director / Monthly
Sales Sales Director

Approval of liquidation of stock below Planning & Finance CEO & CFO Ongoing
agreed margins

SA 1 - PREPARATION OF STOCK AGEING REPORT

i. Stock ageing report is downloaded from SAP with T-code ZSTOCKAGE and is processed against below
locations.
a) UW00 - Openshaw Warehouse
b) UM00 - Middle East Warehouse
c) 2900 - Ohio Warehouse
d) U001 to U999 - Retail Shops
 ii. All above 4 locations reports are consolidated to give one report in GBP.
iii. Ageing report consists of active, slow moving and inactive stocks.
iv. Stock report is extracted on every 1st day of the month and ageing report displays into 60 / 120 / 180 / 240 /
365 / 730 days.

SA 2 - REVIEW OF STOCK AGEING

i. Stock ageing more than 180 days are reviewed and monitored for liquidation on priority basis.
ii. Reports are further monitored based on 7 different categories such as Warehouse, Lifecycle, Brand, Category,
Design, Age and Division.
iii. Cases where inventory age exceeds more than 180 days forecast, MOQ and lead time is checked against the
same for taking further action.
iv. After checking above parameters quality of the stock is taken for consideration and basis suitable channel is
selected for sale.
v. In cases where stock is unsaleable planning team decides to sale at negative margin post approval from CFO.