Private-Label Drink Producer Puts the Squeeze on Excess Inventory
Challenge
This US-based private-label drinks producer wanted to become more proactive when it came to managing its supply chain.
While a branded product may be able to serve many customers’ needs, a private-label product doesn’t have the same flexibility. The company recognised the need for heightened visibility across its supply chain to not just allow it to continue to deliver superior drinks products, but to also best respond to the unique demand planning complexities that come with being a private-label business.
Solution
The private-label drinks producer turned to Logility to provide a digital supply chain platform that would help it decrease inventory and optimise production while becoming more demand-driven.
The company first implemented Logility Inventory Planning to give the organisation the ability to reduce safety stock, alongside Logility Replenishment Planning to vary make-to-order versus make-to-stock inventory based on demand variability and customer lead time.
A few months after the initial deployment, the business added Logility Replenishment Planning to the platform to give production planners the ability to schedule production runs most efficiently.
Impact
Thanks to the Logility solution, the company has increased the effectiveness of its sales and operations planning and has seen results well beyond expectations in each area of its supply chain.
Since introducing Logility, the business has decreased finished product inventory by 10%, even while increasing the number of new items. In just the first six months of using the platform, the forecast error rate has dropped by 25%.
The company has also optimised production planning and increased changeover efficiency. It can now sequence lines better, which has boosted the production rate on one line by 30% and increased production efficiency by an average of 14% on all others.
Perfect orders have increased by an impressive five percentage points, improving customer satisfaction significantly.
