Expertise

Specialists in the development and deployment of supply chain solutions for emerging markets.

Forecasting and S&OP

OverviewCase Study

Planning is becoming ever more complicated as product ranges expand, distribution networks extend and promotional activities become a more central component of the sales process.

Very few companies would claim to be happy with the outcomes of their planning processes. Common problems are:

  • Poor data availability and/or accuracy
  • The wrong tools
  • The wrong policies
  • Lack of talent
  • Insufficient training
  • Poor disciplines
  • Stakeholder coordination

There is rarely a single element solution, so our approach is holistic – comprehending all the factors that negatively influence planning and developing a comprehensive solution; in-house or outsourced.

Client

A leading FMCG manufacturer in Singapore.

Issue

The client had problems with low forecast accuracy at SKU level (MAPE <65%). This led to:

  • An ineffective S&OP process
  • Poor demand and supply planning
  • Poor production planning
  • Incorrect purchases of raw materials and packaging materials
  • High inventory
  • High warehousing cost
  • Product write-offs due to shelf life limitations

Solution

LCA’s solution to improve S&OP processes and production planning was:

  • The provision of a simple and effective ‘quantitative’ forecasting tool
  • Training and disciplining all channel sales managers to provide timely and accurate ‘quantitative’ inputs

Result

Within a short period, this approach:

  • Lifted forecast accuracy – over 80%
  • Improved product availability – 72% to 92%
  • Reduced stock holdings
  • Reduced write-offs – by 50%
  • Diminished “noise” disrupting planning and operations