The Challenge
A Dutch beverage bottling company operated in a very demanding world. The bottling company bottled their own brand while increasingly bottling for A-brands and Private Labels throughout the North-Western part of Europe. Products were bottled under sterile conditions and had a limited shelflife, varying from 3 to 18 months. The company annually was confronted with a growing seasonal peak that was not properly forecasted and which depended on varying weather conditions.
This peak caused an undercapacity and missed revenue during the high-season, while overcapacity with missed opportunities existed during low-season.
ESCIMCO was approached to implement a Sales, Inventory and Operations Planning process to maximise the revenue.
The Approach
ESCIMCO mapped out the incumbent processes regarding Forecasting, New Product Introduction, Inventory planning and Production.
Pain points within and between these processes were identified and prioritised. Solutions to the painpoints were developed, tested and implemented.
These solutions included -but were not limited to- improvements of and better discipline in communication, better understanding of and use of production limitations in production planning, the development of tools for Demand Planning, Inventory and Production Planning.
ESCIMCO coached the SIOP-process during a number of rounds to assure that the process was properly functioning and all knew their roles.
Lastly all adjusted processes and tools were properly documented as per ISO9001-standards, and could be used for future reference and training.
The Results
ESCIMCO implemented a front-end SIOP-process (Purchasing was excluded), which dramatically improved the accuracy of the Demand Plan. The improved forward looking demand view combined with better knowledge of production capabilities, allowed for an optimisation of the production planning as well as shift-planning.
High moving long shelflife products were used to build seasonal inventory ahead of the peak-season, drastically reducing pressure on the high-season. Inventory planning parameters were set for all products to achieve the desired availability levels, while considering optimal production run sizes and optimal sequencing.
The engagement was completed in 9 months and resulted in a 4% revenue increase.
