Success Stories - RM Tools
How one of the leading industrial tools distributors in the Baltics transformed inventory management with Demand Driven MRP.
RM Tools increased its Order Fill Rate from 87% to 95% while reducing Overstock by 56%
Company Overview
RM Tools is one of the leading distributors of industrial tools and machinery in the Baltic region, serving customers across Lithuania, Latvia, and Estonia.
With a catalogue of more than 10,000 SKUs and a growing customer base, the company needed a more adaptive planning methodology capable of balancing product availability with inventory investment.
The company operates both wholesale and retail services, offering an extensive range of tools and accessories through specialized stores and an online B2B platform. RM Tools is known for fast delivery, excellent customer service, and providing product training to its clients.
The Challenge
As operations continued to grow, RM Tools faced several inventory planning challenges:
- Maintaining high service levels across thousands of products
- Reducing excess inventory without increasing stockouts
- Improving replenishment decisions
- Building a scalable planning process to support future growth
Why Demand Driven MRP?
To overcome these challenges, Demand Driven MRP (DDMRP) with Odoo using the ForgeFlow Demand Driven software in 2023, a methodology developed by the Demand Driven Institute.
Rather than relying solely on traditional forecasting, DDMRP creates strategically positioned inventory buffers that respond dynamically to actual market demand, enabling companies to improve product availability while reducing unnecessary inventory.
Our Approach
ForgeFlow worked closely with the RM Tools team throughout the entire transformation.
Assessment
A comprehensive analysis of inventory policies, demand patterns, and replenishment processes.
DDMRP Design
Definition of buffer profiles, decoupling points, and planning parameters based on product behaviour.
Pilot Implementation
A controlled pilot was launched to validate the methodology using a selected product portfolio.
Rollout
Following the pilot's success, DDMRP was progressively deployed across more than 10,000 SKUs.
Continuous Improvement
Regular monitoring and optimisation ensure inventory policies continue to evolve alongside the business.
ForgeFlow's journey with RM Tools
ForgeFlow started working with RM Tools in 2023 to implement Demand Driven MRP (DDMRP) with Odoo using the ForgeFlow Demand Driven software. In a first project stage ForgeFlow delivered the Demand Driven Planner Workshop to the supply chain team at RM Tools in order to provide the necessary education about the DDMRP methodology. The project then continued by preparing a pilot project that included small number of SKU's. The pilot project ran for 6 weeks. The objectives of the Pilot were:
- Consolidate the knowledge about the methodology
- Familiarize users with the new software
- Assess the results from a number of Key Performance Indicators.
The Pilot project resulted in a massive success, and the company decided to roll out the DDMRP implementation across all products. Currently RM Tools is managing more than 10.000 SKU's using Demand Driven MRP.
The importance of measuring through Key Performance Indicators
KPIs provide a clear metric to assess whether you're on track to achieve your goals. They help quantify progress, making it easier to determine whether adjustments or improvements are necessary.
RM Tools has established Key Performance Indicators (KPI's) across their organization, and tracks target KPI values against actuals using historical charts. Here are some of the key KPI's used in supply chain:
- Service Level. This KPI helps to make sure that your organization is aligned to deliver the service. Demand Driven MRP helps to improve this KPI providing clarity on potential disruptions in the flow right-sizing the inventory to align the inventory to actual demand.
- Supplier Performance. Suppliers have to be able to be responsive enough to help you maintain the integrity of your stock buffers.
Freight Optimization
Some providers imposed certain rules, like order minimums or in other cases there were specific transportation requirements such as minimum number of pallets to include in the transportation of products. ForgeFlow's freight optimization suggests the right mix of products and quantities to include in a purchase order to meet the supplier or transportation requirements and achieve the right size of the inventory to meet the customer demand.
Our Shared Story
Get to know more about RM Tools and how ForgeFlow has helped this company from the testimonial of Ramūnas Kembrė, Commercial Director and Vitalijus Paškevič, Logistics Manager.
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