This case features Heidi Lindbøg Karlsen, Purchasing Manager at AUBO, a company established in 1985 in West Jutland, Denmark, which remained family-owned until 2023 when it became part of the TCM Group.

AUBO specializes in delivering high-quality kitchen and bathroom solutions, with a network of dealers in Denmark, Norway, Sweden, and the Faroe Islands. The company is committed to providing products that stand the test of time and enhance everyday living.

This case study demonstrates how AUBO, through a strategic partnership with Inact, successfully reduced its inventory by 20% without compromising production plans or customer satisfaction.

Imagine that all the knowledge about your company’s supply chain is stored in the memory of one of your colleagues. Nothing is written down or documented and everything rests on your colleague’s memory and some Excel sheets.

What happens if that colleague is no longer available? All knowledge disappears.

Unfortunately, this happened when AUBO’s founder passed away in 2021, taking decades of business-critical knowledge with him.  

Heidi Lindbøg Karlsen was thrown into the deep when she became Purchasing Manager in the spring of 2022. She quickly uncovered several inventory issues, all directly stemming from the significant loss of knowledge:

• An overwhelming inventory
• Challenges related to inventory management
• Excessive capital tied up in stock

The loss of AUBO’s founder exposed a deeper structural vulnerability within the company, as critical business knowledge was tied solely to this one individual.

This left Heidi Lindbøg Karlsen feeling powerless. She explained that the inventory challenges made it nearly impossible to keep pace with the rapid changes – both internally within the company and externally in the market.

Another significant challenge was the lack of transparency in data and processes related to purchasing and inventory management. When Heidi Lindbøg Karlsen joined the company in 2022, she quickly realized the need for a clear and easily accessible overview of the inventory to make informed decisions.

The inventory was too large, the capital tied up was excessive, and the workflows needed optimization.

However, the inventory wasn’t just overwhelming and oversized.

Many items were no longer relevant in a rapidly changing kitchen industry, where design and consumer trends evolve at varying speeds:

“As a manufacturer of kitchens and bathrooms in all segments from price-conscious and project sales to high-end, this places tremendous demands on us and our inventory.”

Products can become obsolete within months or years, requiring the entire supply chain to collaborate closely to avoid accumulating outdated stock.

The abundance of dead stock became a significant concern for Heidi Lindbøg Karlsen, who was determined to find a viable, profitable and environmentally responsible solution.

This quest sparked numerous internal discussions about managing the inventory effectively, with Heidi recalling how emotions and “what if” scenarios often complicated decision-making.

The initial step involved a comprehensive analysis of AUBO’s product range, conducted in close collaboration with Heidi Lindbøg Karlsen.

Inact identified the company’s most critical challenges and proposed targeted solutions to address both acute problems and long-term needs. AUBO began by cleaning and updating its master data, which forms the foundation for accurate purchasing and inventory management.

Next, the team focused on gathering and categorizing AUBO’s data and products to provide a clear overview. This approach enabled Heidi to pinpoint inefficient processes and identify areas in the inventory that could be streamlined.

The collaboration between AUBO and Inact centered on deriving insights from data and implementing automation designed to modify the daily practices of those managing the inventory. With the Inact Now platform, AUBO gained real-time visibility into inventory and ABC categorization of all products, resulting in several key benefits:

• Easier identification of dead stock
• Data-driven optimization of purchasing decisions
• Enhanced visibility for production on how to (re)use materials effectively

Armed with this new helicopter perspective, AUBO established two primary objectives:

1. A significant reduction in inventory, aiming for a 20% reduction as set by management
2. A strategic plan for managing dead stock and determining its future

Heidi emphasized the importance of achieving this 20% inventory reduction without compromising customer satisfaction: 

“It’s easy to cut inventory to the point of pain, but ultimately, the customer pays the price.”

Additionally, finding a solution to handle dead stock responsibly was crucial – not only to meet upcoming ESG requirements for documenting a product’s lifecycle from production to packaging but also to honor the founder’s philosophy of finding creative solutions to use and reuse materials.

In just one year, AUBO successfully reduced its inventory value from DKK 37 million to DKK 30 million – a remarkable reduction of 20% without compromising production flow or their commitment to West Jutland’s renowned integrity and on-time delivery.

“It’s incredibly rewarding to achieve exactly what management envisioned,” says the CEO.

The partnership between AUBO and Inact has not only improved financial performance but also fostered better collaboration within the company. This newfound synergy among purchasing, sales, and production teams has sharpened their focus on inventory management. Additionally, the CEO now receives automated updates on key metrics, eliminating time spent debating data accuracy and allowing for more strategic decision-making.

AUBO has long excelled in creative thinking, and this ethos has only been strengthened through its collaboration with Inact, which enables the company to back innovative ideas with solid data.

When speaking to AUBO about the results, Purchasing Manager Heidi Lindbøg Karlsen says she is proud of the results and hopes to add further value to the TCM Group with the knowledge gained at AUBO. She also hopes that the other productions in the Group are curious about AUBO’s journey. CEO Torben Andersen frequently highlights the impressive outcomes and has complete confidence in the purchasing department:

“We had been considering Inact before. It was a relief when our purchasing manager herself inquired about the solution, partly because she had used it with good results in a previous job.”

Heidi also notes that AUBO’s partnership with Inact and the Inact Now platform has significantly boosted their commitment to ESG and responsible production.

The purchasing manager explains that Inact helps them make specific plans for the products based on data rather than emotion:

“As a newcomer, I encountered many emotional and “we can’t do that” arguments against sustainability initiatives. Now, we can rely on data,” explains Heidi Lindbøg Karlsen, and says this data-driven approach helps AUBO determine which products to retain in stock and how to handle discontinued items.

By minimizing waste and optimizing inventory management, AUBO has made significant strides toward more responsible production practices – right down to their packaging. Heidi views this as a critical aspect of AUBO’s future strategy and a vital competitive edge in the industry:

“We need to consider the future of our obsolete products and proactively address it before consumers and regulations demand change.”

However, the journey doesn’t end here
Heidi and the purchasing department have adeptly navigated these changes: despite a substantial inventory reduction of DKK 7 million, AUBO has increased its stock levels without raising overall inventory value.

AUBO’s achievements underscore that effective inventory management requires more than quick fixes or a handful of quick consulting visits; it’s about building partnerships and fostering lasting changes in employee behavior.

And it’s a commitment they intend to uphold.

AUBO is a kitchen manufacturer based in West Jutland, Denmark, and a proud member of the TCM Group. Situated in Aulum, between Herning and Holstebro, AUBO specializes in providing high-quality kitchen and bathroom solutions, renowned for its meticulous craftsmanship and exceptional customer service.

One of the company’s core commitments is to ensure complete and timely deliveries – every single time. AUBO serves dealers across Denmark, Norway, Sweden, and the Faroe Islands and is dedicated to producing durable products designed to withstand generations of everyday use.

www.aubo.dk