Improved demand cognizance for enhanced forecasting 

api_Logo

  • API is one of Australia's leading pharmaceutical distributors and growing health and beauty retailers

  • Parent company of Priceline Pharmacy, Soul Pattinson Chemist, Pharmacist Advice and Clear Skincare Clinics

  • Services: wholesale product delivery, retail services, marketing programs and business advisory services

  • More than 420 stores

  • Founded in 1910, listed on the ASX since 1997

  • Over 3,000 employees

  • Revenue of more than $3.5bn AUD

Further information: www.api.net.au

Success Story

API: Improved demand cognizance for enhanced forecasting 

Inconsistent and unrealistic forecasts led to excess inventory.
To correct the inherent problems, API decided to revamp the demand signal which was being fed to SAP UDF application.

  • Inconsistent and unrealistic (inflated) demand signals unsuitable for statistical analysis

  • Need for manual intervention to offset inflated demand

  • Overforecast situations despite manual interventions

  • Erosion in trust of system/applications by business

Identification of the demand forecast

The project involved both retailsolutions and API teams carrying out extensive analysis of demand signals to arrive at possible combinations of demand quantity and demand dates that can be used to arrive at a demand forecast that fits API business processes.

Solution

  • Deep dive into issues causing inconsistencies in forecast and follow-on replenishment backed by expert data analysis

  • Developed a flexible framework to support different combinations of demand signals to be fed into SAP UDF

  • Ability to run forecast jobs with different demand data and to compare the results

Benefits

  • Inventory reduction in excess of $8.7m AUD  driven by an annual reduction in intolerable forecast-driven overstocks

  • Improved the service level for A&B products to 99.5% using UDF statistical smarts 

  • Dramatic upturn in forecast accuracy (weekly error reduction of up to 10%)

  • Improved responsiveness to customer demands/trends

[English]

We extremely value retailsolutions for their expertise in helping organisations like ours to maximise the return on investment from SAP CAR and SAP F&R implementation.

We are continuing an ongoing engagement with them to achieve further system efficiencies.

API

Kosta Ouskov,

Operational Excellence Manager –
Systems Optimisation

[English]

The store apps we deployed together with retailsolutions were received so well that store managers and franchisees have actually called me to tell me how happy they were with them and how much easier it makes their lives.
Usually, they are a bit harder to please.

Coop Norge

Stein Johnsen,

Project Manager, Coop Norge

[English]

Thanks to Neptune based store-apps from retailsolutions, we massively simplified inventory management, increased automated replenishment with SAP F&R and reduced costs. Stores now have increased availability, reduced waste and more time to serve customers.

Coop Norge

Eirik Borge,

Program Manager, Coop Norge SA

[English]

Significantly improved shelf availability and thus increased sales, while reducing inventory, personnel costs and markdowns. At shop level alone, inventories were reduced by 8%, with corresponding effects on capital costs and spoilage.

Coop Schweiz

August Harder,

CIO Coop Switzerland