Optimizing Business Operations: Strategies for TCO, Inventory and Cash Flow Management with Gergely Burik, Commercial Lead at Gexpro Services Europe

Burik Gergely Gexpro ServicesInterview with Gergely Burik, Commercial Lead at Gexpro Services Europe, who shares how the company assists its partners in tackling challenges and fostering growth in the competitive business environment.


Understanding Total Cost of Ownership (TCO)


Welcome, Gergely! Could you explain to us what Total Cost of Ownership (TCO) means and why it’s important in procurement decisions?

Gergely Burik: TCO is a comprehensive approach to evaluate all costs associated with a product or service throughout its entire lifecycle. It goes beyond the initial purchase price to include factors such as transportation, administration, sourcing, taxes, duties, financing, order management, replenishment, obsolescence, and excess material and even shutdown costs. Understanding TCO enables businesses to make more informed decisions, identify hidden costs, and optimize the procurement chain for cost-effectiveness and efficiency.


Optimizing Inventory Management


How does Gexpro Services Europe approach inventory management to minimize costs and maximize efficiency?

G.B.: At Gexpro Services, we utilize a combination of forecasting, analytics, and strategic supplier partnerships to optimize inventory management. By maintaining optimal inventory levels and accurately predicting demand, we minimize excess inventory and storage costs while ensuring ton-time availability of products to meet customer needs. This approach not only improves operational efficiency but also reduces tied-up capital, enhancing liquidity and free cash flow.

Could you please share with us some inventory management strategies and services provided by Gexpro Services?

G.B.:  The whole concept of successful inventory management is based on the forecast. If a reliable forecast is available, we have an easier job offering solutions like Kanban and Vendor-Managed Inventory (VMI). However, if the demand is not constant, we can also support our partners by holding a safety stock for them so keeping the inventory does not have a negative effect on their free cash-flow and they can use the available liquid money for other purposes like re-investment, R&D, operations etc.

TCO from Gexpro Services

Addressing Cash Flow Challenges


Cash flow management is crucial for business sustainability. How does Gexpro Services Europe assist its partners in this regard?

G.B.: Indeed, cash flow management is vital, especially in industries with fluctuating demand and market conditions. At Gexpro, we focus on negotiating favorable payment terms with suppliers and closely monitoring cash flows. By aligning our financial strategies with business objectives, we ensure liquidity, financial stability, and capitalize on growth opportunities, even during economic uncertainties.


Overcoming Challenges and Facilitating Growth


Could you share some specific success stories or challenges that Gexpro Services Europe has encountered in optimizing TCO, inventory management, and cash flow?

Gergely Burik: Certainly. One notable success story is how we assisted a partner in optimizing their inventory levels and improving cash flow. By collaborating with the partner, analyzing inventory, and leveraging data, we developed a strategy to reduce excess inventory while maintaining rapid product availability. Additionally, we implemented a cash flow management plan that helped improve liquidity and optimize payment deadlines, thereby enhancing the partner’s financial stability and paving the way for further growth and development.



In conclusion, effective management of TCO, inventory, and cash flow is crucial for business success. Through a comprehensive approach to cost management, data-driven insights, and strategic partnerships, organizations can optimize their operations, improve financial performance, and achieve long-term growth and resilience. Gexpro Services Europe plays a pivotal role in assisting its partners in this endeavor.



 About Gexpro Services Europe


Gexpro Services Europe is a world-class Supply Chain Service provider specializing in offering comprehensive solutions for component management. Their core product portfolio encompasses fasteners, hardware, fabrications, electrical and mechanical products, chemicals, and MRO. They excel in developing and managing state-of-the-art inventory management programs tailored to meet the unique needs of their clients, with a primary focus on enhancing profitability and competitiveness.



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