Cash Management – Travelex (Australia)

cash management

Development of a Cash Inventory Management System (CIMS)

Project Background:

Our client wished to build a ‘learning prototype’ conceptual system to manage inventory of cash at over 100 retail branches nationwide. Their current approach involved a lot of guesswork and limited performance analysis.

What We Did:

  • Designed the operating model to account for their reverse cycle logistics (ie, foreign exchange cash received in, equivalent Australian dollars cash amount paid out),
  • Conceived the elements of the CIMS based on the concepts of the Management Operating System (MOS) framework model,
  • Defined the core element of the future CIMS, the Scheduling tool, incorporating inventory drawdown and replenishment profiles, factoring lead time, safety stock levels and reorder point parameters.
  • Defined the remaining elements of the system, including a Weekly Forecasting tool, inventory Planning tool, Measuring / reordering or recycling (returns) tools, and Reporting tools,
  • Designed and built the prototype system in MS-Excel / MS-Access,
  • Defined a new position of the Cash Inventory Manager (a Demand Planner), reporting to CFO,
  • Trained central Storage personnel as well as Branch and regional management in the use of the CIMS,
  • Undertook a phased implementation of the CIMS, commencing with a limited pilot phase, then culminating in a national rollout.

Benefits to the Business:

The business benefits delivered included;

  • implementation of a predictable, dynamic and effective weekly process for dealing with reverse logistics of cash management across the entire retail network and central Vault,
  • provision of clear and forward predictability of central Storage holding and recycling requirements,
  • less stress for operational staff by reduction in guesswork,
  • a significant and sustainable reduction in working capital with simultaneous improvements in service levels.