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A single employee doing unscrupulous things can be enough to make a big business crumble. In this story, a company changing hands and processes while one employee doesn’t care about the details can lead to huge problems.

It led to a lot of extra inventory the company didn’t need, which could’ve been a disaster. But surprisingly, nobody got in trouble.

I got some great business tips from this story.

See why this huge mistake ended up being a blessing in disguise!

Coworker ordered $55M in unneeded inventory

Some years back, the company I was working for was acquired.

My company had a process where we put forecasted orders into our ordering system, and as real orders arrived, we would replace the forecast orders with real ones.

But an unforeseen problem happened with the ordering process. I would have seen the risks right away.

We did this because our lead time for manufacturing was significantly longer than what we were imposing on customer orders.

The acquiring company had a different process, and basically put a bunch of departments on a 1-year transition plan, including the forecast order people..

Turned out there the person entering the forecast orders and the person replacing them were not the same person.

It gets even more complicated than that. Even just reading this tangled up my brain. This thing is going to blow!

The replacing person no longer worked there. So the forecast orders and real orders just kept piling up.

There is another department whose responsibility it is to order material based on orders in the system. They also know the forecast, and should never be ordering in excess of the forecast.

But the person who was doing this had been given her 1-year transition and didn’t care about her job.

Well, she ordered double the forecast.

I’m trying to picture what this would look like? Boxes piled high everywhere!

I don’t see how much inventory we have until it arrives. So 12 weeks later, there was this insane amount of inventory with no customer for it. It totalled to $55M.

This was a big company, but that was still a lot of money.

So we took a reserve on it. ie normally you don’t pay for inventory that is going back out the door to a customer; in this case, we paid for the material, and we would get paid back as we sold it, which we didn’t expect to do.

Nothing happened to the person who over-ordered.

Phew! It worked out in everyone’s favor. I wonder if most of these sales were inbound. This seems more doable if they get lots of referrals and repeat customers.

It seems strange that a lone employee was somehow able to spend $55M at a vendor, but that’s how the system worked.

In the end, we had a massive stroke of good luck, and sold off all $55M in 3 years. It turned out our business targets didn’t account for “non-standard costs,” so we were essentially getting unprojected revenue at 100% margin.

I’m amazed there is even bigger news! It can literally pay when you rise to the occasion.

This maxed out the bonuses of 1500 people every year, which probably ended up being a $100M payout.

Wherever you are, Wanda, thank you. You got everyone paid a lot of money. I don’t think there are more than a handful of us who know this story.

Here is what folks are talking about on Reddit.

My guess would be a super lax accounts payable department, if they have one at all! Reviewing purchase orders is not rocket science.

Oh, come on. This has to be an episode of Parks and Rec or The Office. Using 12-year-old toilet paper is weird.

Good question! Sounds like they need an audit.

If you enjoyed this story, check out this post about a woman who is let go from a charity due to budget cuts, then gets blowback from the board over her severance.

See, Wanda probably has a fan club right now. I’d probably join it.

Accounts payable workers don’t get enough credit. Unless they miss things like this. Then I wouldn’t be happy with them.

This worker’s employer had complicated processes for buying things, but with plenty of ways to screw it up. It’s surprising that a huge accidental order of inventory actually improved all of their lives. That was really good luck!