ESP Specialty

Steel Products

Virtual Inventory Program

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Virtual Inventory

What Is It?• Ability to send data to customer on status of our

inventory• This is done through a feed from our system,

MCMS, to the customers ERP system• Timing of feed depends on customer– Current feeds range from every 5 minutes, to nightly

feeds• Key task is to map customer part numbers and

descriptions to ESP part numbers

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Virtual Inventory

It is easy to deploy. • ESP works with customer IT department • We need a list of part numbers and descriptions from the

customer that they want us to supply information on • We take that list, cross reference it to our part number and

descriptions• We then create a file containing customer-specific

inventory information from our system (MCMS) • Finally the file is sent to customers as either an email

attachment or directly over the Internet, FTP. (See attached example)

Example of CSV File

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Virtual Inventory

Benefits to Customer• Access to sell inventory they do not own• Saves time for buyers to check stock• Saves time of ISR’s in buy outs• Full access to information on inventory ESP

carries just for a customer– This includes on hand, next mill due date, receipt

date

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Virtual Inventory

Business Requirements: What does customer want to see?– On hand or quantity available for sale (on hand less

pending orders)?– Incoming quantity?– ETA of incoming quantity?– Pricing per item?– How to show both ESP locations inventory, Houston

and Chicago, in their system. We will report separately?

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Virtual Inventory

Technical Requirements • What file format do you want the data in?

(.csv, .txt, .xls, other?)• How do you want the data sent? (via FTP or e-

mail)• How frequent do you want updates? (hourly,

daily, etc)

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Virtual Inventory

Considerations• Long periods between data updates makes

info on our inventory in your system out of date. Consider regular data updates (e.g. hourly) to keep info more accurate.

• Take inventory position on both ESP warehouses (Chicago and Houston). Consider setting up as separate locations in your system

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Virtual Inventory

Considerations• In addition to getting our inventory data,

consider also getting info on inbound as well as pricing.

• To broaden ability to sell, consider creating part numbers for items ESP stocks that the customer does not stock. Improves sales efficiency on buyouts, allows customer to be in markets without carrying inventory.

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Virtual Inventory

Managing the Effort

Establish a regular review between ESP and customer:• Review process and performance of data

transmission and availability• Review feedback from sales – Their thoughts on process, use of data– lost opportunities due to inventory– pricing feedback