Skip to content Skip to footer

Implementing supply chain planning system for specialty retailer

Our client is a leading specialty retail company with presence in several CEE markets

CapabilitySupply chain planning system implementationShare

Challenge

Multi billion food retailer opened a new specialty retail branch within the region. The new business supply chain management required a different approach than in the mother company. With over 60 000 active SKUs and short product life cycle (30% of active assortment changing year over year) the new retail chain required automated but flexible planning processes in order to ensure both product availability and maintain company working capital within targeted limits.

Actions

In oder to automate planning process across almost 7 mln SKULs (SKU-Location combinations being the result of 27 000 SKUs spread over 250 stores) company decided to implement new Supply Chain Planning System and replace the legacy SAP MRP module. Our experts aided supply chain team and conducted in-depth advanced planning systems market research and provided company leadership with a short list of potential vendors. Based on through analysis of existing planning processes AS-IS and TO-BE process documentation was created and Request for Proposal was prepared and shared with selected vendors. Company was provided with support in evaluation of presented offers in regards to: functional fit, scalability, security, implementation timline and capabilities as well as commercial terms of the agreement. Total cost of ownership was calculated for each of shortlisted systems and exact business case supporting the investment decision was presented to the executive team. During the implementation our expert served as a project manager supporting the company Supply Chain and IT teams in the project delivery, providing ongoing project risk assesment, and keeping control over project timeline and budget.

Results

Within 14 months company successfully went through the selection and implementation process of a software which is used until today. The selected system not only automated the promotion planning, demand planning, and supply planning processes, but also decreased the workload on the team more than 3x enabling doubling the business size without growing the supply chain planning team. The system supports functions required for proper safety stock planning, exceptions management, forecasting and serves as a single source of trught for Supply Chain, Logistics, Commercial and Finance. Company extended its planning horizon from 5 weeks to 6 months on the SKU level and started to share detailed information with its suppliers which increased their service level by 2p.p. during the first year after the implemenation. The increased cash margin and reduced cost of capital due to decrease in safety stock level financed the total cost of system within the first 1.5 years.

Short summary

The leading specialty retail company needed automated planning system. They replaced their SAP MRP module with a new system after our experts facilitated vendor selection and implementation. The new system automated planning processes, reducing workload and enabling business growth. It improved supply chain functions, increased planning horizon, and boosted supplier service levels, paying for itself in 1.5 years through cost savings.