How is multi-echelon inventory optimization different from traditional inventory planning?

Traditional inventory planning optimizes each location independently, often using static safety stock rules and average demand forecasts.

Multi-echelon inventory optimization takes a network-wide approach. It considers how inventory decisions at one location impact the rest of the Supply Chain and dynamically adjusts inventory levels across all nodes.

This avoids duplicating safety stock across the network and allows companies to achieve better service levels with less inventory.