Companies in the technology industry are being asked to do more with less. Department leaders are expected to identify and implement ways to reduce costs and extend the life of capital investments. To that end, parts and equipment inventory is often the largest single asset and the largest expense. Excellent inventory management is expensive, and the true cost of inventory extends far beyond the cost of the items and the cost of managing the inventory. Take a look at the benefits your company will gain using a third-party vendor for vendor managed inventory.

1. Unlock Simplicity
Key Services, Inc. key-services.com 3921 West Point Blvd., Winston-Salem, NC 27103 (336) 768-4400
8 Ways To Cut Costs Using Vendor Managed Inventory

2. AboutKeyServices
For 38 years, Key Services has created a
legacy of helping customers unlock
simplicity. We partner with large
corporations, Third-Party Service
Providers and OEMs to provide end users
with customized depot repair and
logistical support services that are fast,
flexible, and reliable.
Key-Services.com

3. InventoryManagement
Companies in the technology industry are
being asked to do more with less. Department
leaders are expected to identify and implement
ways to reduce costs and extend the life of
capital investments. To that end, parts and
equipment inventory is often the largest single
asset and the largest expense.
Excellent inventory management is expensive,
and the true cost of inventory extends far
beyond the cost of the items and the cost
of managing the inventory.
In this presentation, we explore the hidden and forecasted costs of inventory management,
and share the benefits of using third-party vendor managed inventory.

4. Snapshot:CompleteCostofInventoryManagement
Costs Associated with Inventory Management:
Capital and Finance
Storage and Warehouse Overhead
Material Handling
Operating Costs From System Downtime
The complete cost of inventory management varies depending on the industry and the
field. Below is a snapshot of costs associated with inventory management in the technology
industry.
Insurance and Taxes
Investment Opportunity Cost
Employee Costs
Expansion Costs
Opportunity: Explore is the benefits of using a third-party vendor to support
inventory management.

5. #1 CAPITALANDFINANCE
Capital and Finance Costs
 Upfront costs to purchase starting inventory
 Costs associated with maintaining stock level of inventory
 Costs of financing inventory purchases
Benefits of using Vendor Managed Inventory
 Vendors have better access to inventory, parts and
competitive prices
 Using a third-party vendor reduces cost of procurement and
ownership of inventory

6. #2 STORAGEANDWAREHOUSEOVERHEAD
Storage and Warehouse Overhead Costs
 Fixed costs of rent, taxes, insurance and other facility related
costs
 Lost Opportunity Cost – How else could the space be used?
Could the space be sold for a profit? Could the space be
rented for an additional revenue stream?
Benefits of using Vendor Managed Inventory
 Provides a single point of contact and reduces administration
costs
 Rarely do all parts and equipment come from one
manufacturer – the vendor streamlines the process
 Vendor absorbs warehousing and storage costs

7. #3 MATERIALHANDLING
Material Handling Costs
 Costs associated with receiving, stocking and processing
inventory
 Employee wages, insurance and benefits
 Purchase and ongoing repair of equipment
 Supplies needed for inventory management
Benefits of using Vendor Managed Inventory
 The vendor relieves the company of high costs associated
with materials handling and frees capital for use with other
areas of the core business

8. #4 OPERATINGCOSTSFROMSYSTEMDOWNTIME
System Downtime Costs
 The more technology-driven business become, the greater
the risk for system downtime
 Downtime directly affects service and revenue
Benefits of using Vendor Managed Inventory
 Third-party vendors invest tremendous amounts of capital in
training technicians
 The expertise of technicians allows them to identify what is
likely to go wrong long before it will and lengthen the
lifecycle of parts and equipment
 Third-party vendors build their business around fast, reliable
services and have established depots in strategic geographic
locations to ensure parts are ready when needed

9. #5 INSURANCEANDTAXES
Insurance and Taxes Costs
 Inventory is a company asset that must be insured
 Taxes are assessed for inventory
 Costs fluctuate based on the value of the inventory and can
be difficult to budget
Benefits of using Vendor Managed Inventory
 Costs associated with inventory and taxes remain with the
third-party vendor

10. #6 INVESTMENTOPPORTUNITYCOSTS
Investment Opportunity Costs
 Lost opportunity from purchasing inventory – funds could be
invested into a money market account or mutual fund
Benefits of using Vendor Managed Inventory
 Third-party vendors offer scalable solutions to best meet the
operational needs of the business and at the most
competitive price
 Provides the opportunity for capital to be used for other
business opportunities that support the core business

11. #7 EMPLOYEECOSTS
Employee Costs
 Employee costs go beyond those managing the inventory -
accounting department to capture the costs of inventory,
cost of management time and supervision of the inventory
process, and the high costs of training repair technicians
Benefits of using Vendor Managed Inventory
 Using a third-party vendor places the accounting and
leadership functions on the vendor
 Training qualified technicians and engineers on repair is also
transferred to the vendor
 Field engineers test and service hardware from all the
leading suppliers

12. #8 EXPANSIONCOSTS
Expansion Costs
 As business grows there are added costs of building out
infrastructure to accommodate for growth
Benefits of using Vendor Managed Inventory
 Using a third-party vendor offers scalable, flexible service to
fit the current and future business operations

13. SearchforthesecapabilitieswithaThird-PartyVendor
With 38 years in the technology industry, Key Services has developed an extensive knowledge
base of the technologies that keep businesses up and running across industries. When
considering a third-party vendor, look for these capabilities:
 ISO 9001: 2008 certification, demonstrating a commitment to continual improvement and
quality
 State-of-the-art infrastructure and extensive knowledge base to with the ability to manage
all aspects of product support
 Responsive service available 24 hours per day, 365 days per year using a customized web
portal
 Ongoing training for technicians and engineers on a variety of equipment and
manufacturers
 Reverse engineering capabilities to assist with branded and non-branded parts repair
 Scalable, flexible workforce with strategic partnerships for responsive, fast, reliable service
 Customizable web portal for streamlined project and inventory management

14. OurCertifications
Our state of the art technology center, including the
Custom Web Portal and Data Analytics, A+ certified
technicians, and ISO 9001:2008 certification,
demonstrates Key Services’ commitment to quality
and efficiency.

15. OurTeam
Michelle Deal
President
• NC based
• 20 years general
management with Key
Services, 3 years as
President
• BS Electrical Engineering
Lisa Hodges
Vice President, QA
• NC based
• 15 years in general
management
• 5 years small business
ownership
• BS Business
Administration
Mike Vaughn
VP, Materials
Management
• NC based
• 27 years with Key Services
with experience in all
aspects of operations and
technology
• AAS in Computer and
Electronic Engineering
Roger Dalton
Chief Engineer
• NC based
• 17 years of electrical
design engineer
service with Key
Services
• 9 US and Foreign
patents
• MS Electrical
Engineering
Teresa Bullock
Director, Business
Intelligence
• NC based
• 14 years in accounting and
finance
• SQL Server Business Intelligence
Certified Professional
• CPA
• BS Accounting

16. Howcanwe help
yousimplifyyour
business?
Key Services, Inc. key-services.com 3921 West Point Blvd., Winston-Salem, NC 27103 (336) 768-4400