Revolutionizing Supply Chains with Smart Life Cycle Strategies

The Role of Item Status Codes in Achieving Optimal Sales and Inventory

With supply chain disruptions becoming the norm, identifying a product’s life cycle stage is more important than ever.

No longer just a logistical necessity, Product Life Cycle Management (PLM) is a strategic asset that puts manufacturers’ brands in front of customers and ahead of the competition. Accurate life cycle coding empowers distributors to stock and sell more products with targeted marketing and precise product inventory.

The Importance of Product Life Cycle Codes

IDEA Connector’s product life cycle codes, also known as Item Status, present a structured pathway through the product journey—from its initial conception to its strategic withdrawal.

By using product life cycle codes, companies can:

  • Oversee products efficiently, addressing every phase with precision and foresight.
  • Optimize resources, reduce waste, and align product offerings with market demand.
  • Offer a universal language between manufacturers and distributors for effective product tracking and management.

Life Cycle: The Impact on Profitability and Customer Service

Beyond the bits and bytes in your database, the strategic application of product life cycle codes holds the key to unlocking profitability, enhancing brand loyalty, and optimizing customer satisfaction.

For manufacturers, the diligent application of these codes is not just about compliance; it’s a strategic endeavor that enhances visibility across the supply chain, enabling distributors to make informed decisions that directly impact sales performance and customer satisfaction. Properly coded products facilitate better demand forecasting, reduced inventory costs, and improved service levels—key metrics that define market success.

For distributors, advocating for current and comprehensive product data from your manufacturing partners isn’t just beneficial—it’s essential. It enables you to not only meet but anticipate customer needs, offering alternative solutions within the brand that keep sales flowing. For instance, a well-timed push on a product that is being phased out can clear inventory before it becomes obsolete, protecting profits and keeping customers engaged with relevant offerings.

Inventory Management

Life cycle codes play a pivotal role in inventory management, helping to ensure that distributors maintain optimal stock levels. By indicating the current phase of a product, these codes prevent the overstocking of items nearing obsolescence and understocking of new, in-demand products.

Strategic Planning

Product life cycle codes are instrumental in strategic planning, enabling companies to predict shifts in product demand. This foresight allows for timely adjustments in production, marketing strategies, and sales efforts, ensuring that businesses remain agile and responsive to market dynamics.

Communication Efficiency

Standardized life cycle codes enhance communication between manufacturers and distributors. By using a common set of life cycle codes, such as those provided by the IDEA Connector, companies can avoid misunderstandings and ensure synchronized operations.

The product life cycle code in IDEA Connector is important to United Electric Supply because it’s a critical piece of information that supports decisions for allocating our time and resources. From managing cash to warehouse space to listing on our website, this impacts what products our employee owners focus their time discussing with customers. It’s also good data governance: information that’s accurate, complete, accessible, and timely. Inaccurate data incurs costs—canceled orders, product returns, and missed sales opportunities—but also unhappy customers. Ultimately the product life cycle code supports United Electric Supply’s effort to provide the right product mix that aligns with what our customers need and want.

—Susan Kerner, Director, Pricing & Data Analytics, United Electric Supply, Co., Inc.

The Life Cycle Journey: IDEA Codes in Action

Development and Introduction: Seeding the Market

Item Status (I) – Introductory

  • As new products are conceptualized and prepared for market introduction, they enter the IDEA system with an (I) status.
  • Benefit: This phase is critical for laying the groundwork, allowing manufacturers to populate a minimum number of fields so the distributor can set up the base data in their system in order to immediately sell the product. It’s a crucial time for distributors to gather market intelligence and set the stage for a successful introduction.
  • Pro tip: Avoid the Pitfalls of Skipping—Launching without (I) status and its comprehensive product details can introduce significant delays. Distributors may need extra time to adapt their systems and educate sales teams, potentially slowing down the initial sales drive and affecting the product’s smooth entry into the market.

Introduction to Growth: Capturing Attention and Building Momentum

Item Status (A) – Active Item

  • With the product officially available for sale, it transitions to an (A) status.
  • Benefit: This phase is focused on building market awareness, driving initial sales, and establishing a foothold in the competitive landscape. The active status indicates to distributors that these products are ready to be pushed aggressively to capture market share. Ensure that all-inclusive product details are filled in for a robust market launch.
  • Pro tip:  Stay vigilant with timely status updates to your products. This can prevent customers from mistakenly ordering a product that is actually obsolete, safeguarding sales and customer satisfaction.

Growth to Maturity: Expanding and Solidifying Market Presence

Item Status (M) – Mature

  • As the product cements its presence in the market and sales begin to stabilize, it achieves a (M) status.
  • Benefit: This maturity phase is critical for exploring strategic expansions, optimizing marketing efforts, and beginning to think about product enhancements or next-generation developments.

Maturity to Decline: Managing the Inevitable Transition

Item Status (P) – Planned Obsolescence

  • The journey to phase out a product is managed through strategic planning, with (P) status marking products slated for planned obsolescence and (O) status for those no longer in production.
  • Benefit: This stage is designed for minimizing excess inventory, exploring product line extensions, or reinventing offerings to inject new life into the brand.
  • Pro Tip: Ensure that distributors are getting clear signals about the future of your product, so they can proactively sell the product before it is obsolete and clear inventories to support your next-generation products. This is a good time to add in product relationship data like substitutes or replacement products so that distributors can assist their customers with finding alternatives. 

Item Status (O) – Obsolete

  • The phased-out product is managed through (O) status for those no longer in production.
  • Benefit: This stage is designed to communicate the product is no longer available and the manufacturer is no longer accepting orders. Typically, items in this status are no longer updated by the manufacturer.  A manufacturer may leave product in this status for up to two years depending on the manufacturer guidelines for removing product data from their internal systems.
  • Pro Tip: Ensure that distributors are clearing inventories and removing product data from their ERPs and webstores.

Decline: Deciding the Endgame

Item Status (D) – Deleted

  • Ultimately, some products will reach the end of their life cycle, necessitating removal from the market, indicated by a (D) status. Flagging an item for deletion and adding the reason for removal in the UI will complete the process. 
  • Benefit: This phase involves managing the deletion process gracefully, ensuring clear communication with distributors and mitigating any potential inventory issues. Once the item has been removed from the system, it will not be a part of future downloads. However, IDEA maintains a historical record of each item for distributors to access and review.  

Together, Let’s Lead the Market

By integrating IDEA product life cycle codes into your broader product management and strategic planning efforts, you unlock the full potential of each product phase, ensuring that every step—from conception to conclusion—is navigated with precision and strategic foresight.

Manufacturers: Prioritize Your Product Life Cycle Management

The regular upkeep of product life cycle codes is vital for maintaining market relevance and operational efficiency.

I encourage our manufacturing partners to maintain the product lifecycle codes and keep those up to date, timely, and accurate.

—Susan Kerner, Director, Pricing & Data Analytics, United Electric Supply, Co., Inc.

How IDEA Can Help

The task of maintaining accurate and current product life cycle codes can seem overwhelming, particularly for teams already stretched thin. If your team is resource-constrained or you’re seeking to enhance operational efficiency, consider IDEA’s Pro Data Services. Our experienced team can come along your team, ease the burden, help automate and improve processes, and support your journey to improved data quality and up-to-date product content. IDEA can provide reporting to identify discrepancies as well as load files to update the life cycle status codes on your behalf. 

Whether you leverage internal resources or partner with IDEA Pro Data Services, the goal is clear: ensure your product data reflects current reality, empowering strategic decision-making across the product life cycle.

Training materials for manufacturers

IDEA Connector Product Life Cycle chart: https://idealearningportal.idea4industry.com/learn/course/idea-resource-library/best-practice-white-papers/idea-connector-product-life-cycle?client=manufacturers&page=1

Item Status Definitions & Usage in IDEA Connector: https://idealearningportal.idea4industry.com/learn/course/idea-resource-library/best-practice-white-papers/idea-connector-product-life-cycle?client=manufacturers&page=2

IDEA Pro Data Services: https://idea4industry.com/pro-data-services/

Questions? Reach out to IDEA Customer Success by phone or email.

Distributors: Advocate for Product Life Cycle Updates

Your role in advocating for accurate product data is pivotal. Encourage your manufacturing partners to prioritize the maintenance of life cycle codes. Accurate and up-to-date product information is a cornerstone of your inventory and marketing success.

More information

Request product life cycle updates through the Data Quality Hub link

Training materials for distributors

IDEA Connector Product Life Cycle chart: https://idealearningportal.idea4industry.com/learn/course/idea-resource-library/best-practice-white-papers/idea-connector-product-life-cycle?client=distributors&page=1

Item Status Definitions & Usage in IDEA Connector:  https://idealearningportal.idea4industry.com/learn/course/idea-resource-library/best-practice-white-papers/idea-connector-product-life-cycle?client=distributors&page=2