Archive for January, 2013

Risk mitigation has become a common buzz-phrase  thrown around offices; it’s up there with “synergy”, “cross-departmental

Andrew Bulmer, SVP and Managing Director

Andrew Bulmer

problem-solving”, and “paradigm-shifting”. Enterprise risk management: what does it really mean?

Budgeting, forecasting, and company-planning revolve around our ability to accurately predict market reactions. Will our current products continue to do well next year? Can we expect the same kind of success with our new product lines? What about our competitors?

Even the most successful companies can’t predict all market variables and thus enters the need for enterprise risk management strategies, to reduce the negative effects of unforeseen circumstances.

Enterprise risks can come in a number of forms. However let’s focus our attentions on one particular area of risk, inventory management and turnover.

Inventory Management Report Image

The concept of supply and demand is as old as business itself, and although computer simulations, complex algorithms, and the brightest analytical minds on the planet have become incredibly accurate at predicting demand, no method is 100%.

A current example could be the recent NHL lockout. Perhaps there were signs in the summer that there could be a lockout, but none of the hockey merchandise retailers could have predicted that there would be such an extended lockout months ago when they were ordering their inventory for this year. Now those retailers are stuck with storerooms of inventory that is hard to sell.

So what’s a business to do? For manufacturers, having just-in-time (JIT) manufacturing is one way to ensure that only the needed amount of product to meet the current demand is created at any given time. Although this can be a complicated process, those companies that have successfully applied this type of manufacturing avoid unnecessary spoilage and holding costs associated with incorrectly predicting demand.

DellLogoDell is a great example of a company that revolutionized the way tech companies manufacture products. A problem inherent in the technology sector is high inventory turnover rates. Within months of a product hitting the market something newer, faster, or more advanced emerges. Dell had been able avoid its products becoming outdated by only building a computer once it’s been ordered by a consumer.

Perhaps JIT manufacturing isn’t an option for your company or perhaps your main area of enterprise risk management lies more in the uncertainty involved with launching a new product into the market. You’ve done you market research, you’ve tested in consumer groups, and you’ve completed a detailed SWOT analysis. But still, there are risks.

Pepsi-AMDo you remember Pepsi AM? Me neither. Pepsi had wanted to try to enter the morning caffeine market, selling Pepsi AM as a substitute for coffee. Well, needless to say Pepsi AM failed to win over coffee drinkers, thus showing that even one of the most successful companies in the world can misread the market.

So how else can your company plan for inventory risks that you can’t predict? Consider using Corporate Trade (also known as corporate barter) as a contingency plan. Excess inventory sitting in your warehouse incurs carrying costs and can ultimately spoil, causing you to take a loss on the books.  Using Corporate Trade is one way you can avoid incurring a loss.

Corporate barter companies like Active International allow you to realize the full market-value of any excess or unwanted stock. Instead of cash, Active will give you Trade Credits for the inventory. Those Trade Credits are then used to offset the cash expense on things like media, freight and logistics, and retail merchandising. Using Corporate Trade allows you some breathing room when making inventory predictions for the next year knowing that excess inventory won’t become a source of worry. This peace of mind allows more room for product and innovation without failure of total financial loss if the new idea doesn’t take.

So if your company’s new product launch doesn’t quite excite the public as you had predicted it would, consider Corporate Trade as a risk mitigation technique to realize the full economic value of your inventory. Your CFO will thank you.

By Andrew Bulmer

SVP and Managing Director

Active International Canada

Getting to Know Us: Victoria McMinn

During the holiday season I spoke with the vivacious Victoria McMinn, Key Account Tactical Manager.Victoria McMinn

Explain your job as you would to a 5-year-old:

You know the commercials you see on TV and hear on radio? I am the one who books the space during the shows for commercials for my clients.

Why Your Role and why @ Active?

I joined Active almost 2 years ago from a traditional advertising agency and when I saw that Active was looking for an experienced buyer I jumped at the chance for a new and different experience.

Most memorable moment at Active so far?

Winning the grand prize at the BES (Broadcasting Executives Society) annual Christmas Luncheon – a trip to anywhere in the world! If I wasn’t working at Active I wouldn’t have had the opportunity to attend such a great event and to win such an incredible prize.

Tell us about your charitable cause of choice and the last thing you did to support it?

The last charity I supported was the WWF (World Wildlife Foundation).  I have supported this charity for 12 years with my dad who participates in the annual CN Tower run.

If you weren’t in your current career you would probably be ……

…  a music teacher.

Adjective your family would use to best describe you?


Adjectives your Customers would use to best describe you?

Friendly and organized.

Adjective your best friend would use to best describe you?


Biggest Trend Impacting Your Area of the Business To Date?

The digital landscape continues to grow and evolve and I see more and more digital ad buys on clients’ plans.

What’s the most innovative thing you’ve seen a customer do to unlock value from their assets?

I think Active’s innovative business model allows current and future clients the oppotunity to see so much value-added. They are be able to use their trade credits in such diverse areas as advertising budgets, retail merchandising & printing, and freight.

Favourite Ad of all time?

My team actually just saw a great ad not to long ago when we were talking about home offices.  It’s the Whiskas commercial where the guy who works from home is snuggling up to his cat and forgets he is on speaker phone with his co-workers at the office.Whiskas commercial

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