fresh lab webinar: making big cuts in seasonal fresh food residual stock
DESCRIPTION
Learn how to reduce stocks yet improve availability during seasons and campaigns. This webinar presentation will concentrate on fresh food replenishment and on how to plan your campaigns. It showcases examples of how our customers have managed to cut residual seasonal stock significantly while improving their seasonal sales. Our aim is to help you automate fresh food replenishment, cut waste, increase availability and offer your customers fresh products that are even fresher. And that in turn makes a big difference to profitability.TRANSCRIPT
RELEX Fresh Lab Webinar 2 30 January 2014
Special situations in fresh replenishment
Agenda
About fresh webinars and RELEX
Special situations in fresh replenishment
Case: JJ Foods
RELEX agile implementation
Q & A
Fresh lab webinar themes
Webinar 2: Special situations in fresh
replenishment
30 January 2014
Reviewing the key elements for automated replenishment• Daily SKU-location level forecasts• Shelf-life management• Optimizations and workflow
Leveraging efficient base process and flexible reporting to control special situations:• Seasons• Campaigns
Webinar 1:Key elements of fresh
replenishment
21 January 2014
RELEX in brief
• RELEX offers solutions for demand forecasting, automated replenishment, inventory optimisation, and supply chain analytics– Built especially to the requirements of grocery
retail: incorporates short life-cycles, seasonality, campaigns, assortment management and chain structure of delivery networks
• RELEX is the fastest growing supplier of SCM solutions in Europe– Highest ranked SCM solutions provider on the
Deloitte Technology Fast 500 EMEA list in 2011, 2012 and 2013
– 70 supply chain professionals working at offices in Finland, Sweden, Germany and the UK
RELEX solutions are used for managing and controling material flows at 50 customers in 12
European countries. These cover millions of SKUs worth billions of euros
RELEX references
Agenda
About RELEX and Fresh webinars
Special situations in fresh replenishment
Case: JJ Foods
RELEX agile implementation
Q & A
The challenge and the potential in a single word – spoilage!
Recap from Webinar 1: Harnessing accurate day level calculations and product shelf-life is the key to masteringspoilage automatically!
In order to get the balance right for the fresh replenishment in the firstplace, one must be clear on availability and service level goals and
priorities!
Day-level forecasts Day level safety stock parameters
Simulated spoilage Expected shelf-life factor in safety stock
FORECAST SAFETY STOCK
Automation of fresh replenishment demands for adequate level of detail and flexibility from the replenishment system!
• Forecasts and other data can be viewed and edited at all levels– By product hierarchy level– By region– By time period (day, week,
month, quarter, year)– Any combination of above
• Easy drill-down from upper categories all the way down to individual product-region level
• Possibility to flexibly and easily create new report views whenever needed
• Flexible visualization to facilitate examination of any time-series data
Basic steps of holiday demand-supply planning process
1. Forecast holiday period’s demand
2. Create a supply plan based on delivery schedules and inventory goals
3. Execute store deliveries based on latest information
1. Forecast holiday period’s demand
• Use automatic references– Fore fresh luckily quite often
possible! • Calculate weekday profiles
automatically or set manually– Note the moving and non-
moving holidays!• Increase the quality of the
forecast by adjusting it manually– Levels:
• Product - store location type• Product group – store• Product-chain
• Experienced forecast analyst canmake a significant difference!Example of setting up an automatic reference
run in RELEX
2. Create a supply plan i.e. “store delivery forecast” based on delivery schedules and inventory goals
Potential stress points:
1. Receiving capacity at individual stores: Usually the amount of total goods / pallets arriving is key
2. DC picking capacity: Usually the number of picked delivery lines is critical
3. DC warehousing space: The number of pallets forecast to be in stock
Example of realized and projected balances and delivery rows for one product group in one
location in RELEX
3. Execute store deliveries based on latest information available!
1. Order goods based on the SKU-chain level
order forecast for the delivery day
2. Allocate the products on stores using the most
recent SKU-store level information once the
products are in the DC
Basic steps in campaign forecasting process1. Manage campaign
information
2. Include logistic information
3. Let the system calculate
4. Review and adjust forecasts
5. Collaborate with suppliers
• Use data from earlier campaigns to estimate sales and margin impact in the future• Estimate sales impact of individual campaign variables: discount, shelf location etc
• Define how many days before campaign start you want goods to arrive• Define a presentation level (% of forecast) that is used for initial fill
• System calculates an SKU-Store –level sales forecast and delivery plan for the goods on promotion
• Review aggregate level forecasts to check accuracy and ensure capacity• Adjusting can be done also on aggregate level – system cascades changes to
lower levels
• Distribute order forecast to guarantee capacity and availability of products in promotion
• Collaboration can be extended to actual campaign data
Execute and review
• Execute replenishment as with normal replenishment• Review campaign success rate with operative and commercial KPIs!
Example: Review information on campaigns and drill-down to particular campaigns and products
15
Agenda
About RELEX and Fresh webinars
Special situations in fresh replenishment
Case: JJ Foods
RELEX agile implementation
Q & A
Case: JJ Food Service
• Goals and challenges– Despite add-on functionality developed in-house, the company’s ERP functionality
for forecasting and requirements was considered insufficient– JJ Food Service sought to increase the level of automation in purchasing while at
the same time attaining higher precision in replenishment– A need for managing campaigns, holidays, seasonal variation, fresh food and
customers’ menu-driven demand more efficiently
• Results attained by JJ Food Service (reported after three-month pilot phase, during which a full roll-out was completed)– Purchase ordering requires 25 % less time– Inventory levels have decreased by 15 %– 10 percentage points improvement in service level of fresh food, without increased
inventory levels– 10 percentage point improvement in service level for slow-movers
JJ Food Service is British multi-channel food service wholesaler. The company's’ turnover in 2012 was approx. 180 m£.
Agenda
About RELEX and Fresh webinars
Special situations in fresh replenishment
Case: JJ Foods
RELEX agile implementation
Q & A
RELEX value promise is enabled by big data technology
RELEX Big Data Technology
• Columnar database• In-memory analytics• SaaS-based
RELEX Agile Projects
• Easy to integrate• Easy to pilot• Easy to scale
RELEX Value Promise
• Risk-free: pay as you go• Flexible: Adjust vision• Rapid and reliable: Quick
results
RELEX Agile project structure
Data model
System architec-
ture
First data model build up
Milestone1: System
specified
Business needs
Data interface finalization
Milestone 2: Ready for business
validation
Milestone 3: Ready for pilot
use
Acceptance testing
PRO
JECT
KIC
KOFF
Business process specifications
Configuration of use processes
Validation of use processes
Milestone 4: Ready for roll
out
Business testing in real life
Iterative technical development
PILOT …
Each milestone cycle typically lasts for 4 weeks – pilot can be startedin three months
Thank you!
Any questions?