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Optimization of the stock management

Project: Optimization of the stock management

Project Sponsor: Zh. Kh. Madiyev - Deputy Chairman of the Board for finance, JSC “NC “KTZ”.

Project Director: Sh.S. Omarbekova - Financial Controller, Director of the Department of the Treasury, JSC “NC “KTZ”.

Project Leader: G.S. Amanbayeva - 1 Level Chief Manager, branch of JSC “NC “KTZ” - “Center for Business Transformation”.

Project goal:

Improvement of financial indicators of JSC “NC “KTZ” in terms of management of working capital and material flows due to:

  • Reduction of the stock by means of involvement or sale of unclaimed and surplus stock for 25% of the amount of the slow stock;
  • Reduction of the costs for internal logistics and stock ownership due to optimization of material flows, including by means of consolidation of the stock storage sites;
  • Optimization of the stock turnover while ensuring a set level of service through implementation of replenishment models by 15% of the amount of replenished stocks.

Project description:

The Project is aimed at improving the stock turnover due to implementation of the replenishment models (optimal deadlines, delivery volumes and frequency). It is planned to develop and customize the simulation model of the logistic network, which will allow optimization of the material flows of JSC “NC “KTZ” and its subsidiaries. Idle and slow stock of JSC “NC “KTZ” and its subsidiaries will be released. Additionally, the irreducible stock level will be reduced due to centralization of the inventories storage.

Project implementation period: 2018-2020.

Project scope: JSC “NC “KTZ” - Corporate Center, branch of JSC “NC “KTZ” - “Directorate of Backbone Railway Networks”, JSC “KTZ - Freight Transportations”, JSC “Kaztemirtrans”, JSC “KTZ Express”,   JSC “Passenger Transportations”, JSC “Temirzholsu”, JSC “Wagonservice”.

Project benefits: Financial benefits are provided.

Qualitative benefits:

  • Improvement of logistic service;
  • Reduction of the timeline for ordering cycle and improvement of delivery reliability;
  • Improvement of the warehouse infrastructure utilization performance;
  • Development of competencies in the field of stock management and logistic infrastructure.