AI Enhances Rental Inventory: 4% Cost Reduction, 8% Demand Increase

A company with a complex inventory across numerous locations faced challenges in meeting customer demand, optimizing stock levels, and making quick decisions. They implemented an AI solution for order allocation and replenishment. This AI analyzes data to predict demand and strategically distribute equipment, to lead to a 4% reduction in inventory costs, an 8% increase in demand fulfillment, and a faster decision-making process for product placement.

Client:

Speedy Hire PLC is a major equipment rental provider serving a wide range of industries across the UK, Ireland, and the Middle East. They cater to diverse industries, from construction and manufacturing to retail events, offering essential tools, specialized equipment, and training services. With over 200 depots, Speedy Hire ensures businesses have the resources to operate efficiently.

Problem Statement:

● Ensuring exceptional customer service by providing the right products whenever and wherever customers need them.

● Managing a complex inventory of 3,500 products across 200 depots, accurately forecasting demand, and meeting a four-hour delivery and collection promise.

● Optimizing inventory allocation to minimize stockouts and storage costs while ensuring product availability.

● Predicting rental duration and equipment condition upon return to enhance forecasting accuracy and improve resource planning.

Results:

☑️ Inventory savings: Speedy achieved a 4% monthly reduction in inventory costs.

☑️ Demand fulfillment: Despite inventory savings, Speedy met 8% more demand on average monthly.

☑️ Decision speed: It now takes just one hour (vs. over a week) to determine optimal product placement within the network for maximum sales.

☑️ Improved ROCE: AI-driven inventory optimization facilitates better resource utilization, potentially leading to an enhanced Return on Capital Employed (ROCE).

AI Solution:

Leveraging AI, Speedy Hire’s Peak system streamlines equipment allocation across its extensive network, guaranteeing availability and maximizing utilization. Peak, designed explicitly for Order Allocation and Replenishment, simplifies Speedy Hire’s inventory management.

Peak analyzes historical data to forecast the demand for each product at every depot. This goes beyond simple predictions. Peak recommends the ideal equipment distribution throughout the network, considering factors like past rentals in nearby areas and projected equipment return conditions.

By strategically distributing equipment with Peak’s AI, Speedy Hire avoids stockpiles and ensures equipment is readily available at high-demand locations across their vast network. This efficient equipment distribution, achieved through Peak’s AI, minimizes unnecessary storage and associated costs—a significant advantage in today’s rising warehousing expenses. Speedy can also predict ideal inventory levels for each product at each location with Peak.

The benefits extend beyond cost savings. Peak’s AI transforms Speedy Hire’s daily decision-making, leading to a more confident and reliable supply network. This improved efficiency ultimately translates to increased equipment utilization and a better Return on Capital Employed (ROCE).

Interesting Fact:

Speedy’s Support Services recognized Peak as the Supplier of the Year award recipient.

References:

1. Right products, right place, right time / Speedy Hire Case Study

2. The Peak AI Platform Lets Businesses Tap Into The Power Of Artificial Intelligence

Industry: Equipment Rental
Vendor: Peak AI
Client: Speedy Hire PLC