“We will celebrate our 30th anniversary in November.” That’s how David Danis, key account and supply chain manager of NRG Fitness, introduces his employer. To make it clear – the company based in the south of the Netherlands is an established name in the fitness sector.

Founded as an importer of Homegyms and Spinbikes, NRG Fitness grew from a service company for fitness equipment to a wholesaler of fitness and wellness equipment. David: “We are unique in our sector because we have a wholesale function for various brands and manufacturers, but we also supply directly to the consumer market. And also produce products ourselves.”‍

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“Everyone is fitness minded”

David, who has been part of NRG Fitness for four years, has seen his role within the company change. “I still manage a few accounts, but most of my time is spent purchasing and optimising our supply chain.”

David continues: “We are a relatively small team of ten employees and all fitness minded; that helps me in my role as a purchaser, for example, if I want to introduce a new product.”

“NRG Fitness focuses on fitness and wellness equipment in the premium segment. For example, we supply to a fixed group of dealers who help consumers with their choice at home. But we also help our dealers to offer the best products for personal trainers, companies and hotels. We produce ourselves but also manage 37 brands as a distributor for the Benelux and have approximately 2000 products within our growing range. Because we serve both B2B and B2C customers, we supply a wide range. That is a blessing but also challenges our supply chain management.”

“A challenge to keep our supply chain manageable”

David explains: “Especially during the Covid-19 pandemic, our range has grown rapidly. We can select the most interesting products because we are not tied to a brand or specific supplier. We are active in many markets, which offers many opportunities, but sometimes makes it challenging to keep the entire supply chain manageable.”

“Many of the challenges we face today arose during the pandemic. Due to the lockdowns, a huge increase in exercise equipment demand made our sales explode. Coincidentally, we had just signed for a larger warehouse with three times as much warehouse space. But even this space turned out to be too small during the pandemic.”

Thanks to automation, NRG Fitness managed to scale up processes quickly. Still, one of the systems they needed was a purchasing tool. And that became more apparent as sales declined at the same time the stagnant supply chain started to recover.

David: “Demand decreased, but what remained was an overcrowded warehouse. That was the trigger for us to start optimising things and to start with Optiply.”

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“Often too much or too little stock”

“We were already working with Exact software, and I used to purchase with this system – via min/max order levels. I ran a purchasing analysis every week and based on that, I planned my purchase orders. Still, with that method, we were almost always too late. You can sell five products to five consumers in one day, but inventory management becomes much more difficult if a business customer orders fifty items.”

“Another example is the seasonality of fitness products. In the summer, there is simply less demand for fitness equipment. We could only manage those things statically, often resulting in too much or too little stock. Fortunately, since we work with Optiply, we have less trouble with that. And that is also what the numbers show.”

“Choosing a data-driven approach”

“Starting with Optiply was choosing a data-driven way of working. More visibility, with the aim of getting our supply chain under control.”

David sees a change in NRG Fitness’ inventory management. “We look much more critically at our range, especially since we are still getting rid of excess stock. In Optiply terms, we are now much more focused on our most important products. It is a search for balance – also in terms of liquidity – to purchase your most important products and, at the same time, reduce ‘older stock’ that has been in the warehouse for some time.”

“Optiply also enables me to switch more easily between purchasing from a manufacturer or supplier. Certain products are available from both, but there is often a difference in price and lead time. Optiply allows me to easily compare suppliers for the same product without manually calculating. That knowledge has certainly strengthened my negotiating position with my suppliers.”

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“The data looks very spectacular”

NRG Fitness’ data shows two remarkable numbers – the service level has increased by 30% and the inventory has decreased by 46%. David explains: “When we started with Optiply, we were at our absolute limit regarding inventory and warehouse space. Therefore, you should see the inventory decrease in perspective, but the fact remains that our stock has been reduced thanks to Optiply.”

The same shows the increase in service levels for the A, B and C categories. “The data from our service levels looks very spectacular. This is partly because many products were available again when we started with Optiply. Still, our product availability has increased significantly and is improving monthly.”

“I notice that the algorithm is still learning for us, mainly due to the Covid-19 sales peak. I take Optiply by the hand, look at the data and use my own judgment to determine whether I am following Optiply’s advice without thinking. Optiply is my ‘gatekeeper’. It makes me certain that I can invest in products with a long lead time. In the end, it often involves a lot of money.”

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“The year of optimisation”

Finally, David gives an insight into NRG Fitness’ future plans: “We really see this year as the year of optimisation. With Optiply we can provide even more insight into data. It gives me many opportunities to get started with warehousing, for example. In addition, destocking has a positive effect on our liquidity.”

“There are fewer lost sales and we can decide to phase out certain products. This creates room to invest further – in new products, new brands and also the own production with our massage chairs that we want to scale up.”