EUROFOOD, a growing company offering a large range of products
With 90 employees and a revenue of 15 million euros, the Eurofood company imports products from Europe and Asia, and distributes them exclusively on the Thai market. This growing company manages about 600 products from various brands (Beyond Meat, Bonne Maman, Andros, Paysan Breton, Tramier…) on two channels: Retail (food stores) and Food Service (hotels and restaurants).
Long planning horizons and strong seasonality means necessity for reliable forecasts.
Most of the products being imported from Europe, the lead times are long: « Products are available to be sold 3 months after the order » explains Etienne Devictor, Demand Manager for Eurofood.
An order usually represents 2 months of stocks, so the global forecasts horizon is 5 months, which increase inertia and stock replenishments. Eurofood is distributing products with shelf life comprised between 25 days and 3 years, the quality of the forecasts is thus strategic for an efficient stock management.
This long horizon also causes a loss in reliability and it was difficult for the sales representatives (then in charge of the forecasts) to have a 5 months visibility on the business.
Moreover, the seasonality, particularly strong on the Food Service channel impacted by the touristic season, increases the complexity of the process. “We noticed that despite the monitoring tools in place we used to react afterward”. With a strong structural forecasts’ bias, the Eurofood forecasts, too optimistic, impacted the stock levels causing an important financial stress. By enduring over stock effects, the company was often bound to do sales operations to avoid expirations. “We decided to change our process and get an appropriate tool” explains Etienne.
A change of process and the centralization of forecasts
Until then, the demand plan was an aggregation of forecasts made on Excel by the sales representative. Due to their activity and optimism, the actors of the process had a tendency to over-plan and preferred to have more stocks to be sure to avoid shortages.
« We decided to change the roles and appoint one central person in charge of the demand generation to address the entire market” explains Etienne.
« Moreover, the data management was complicated due to Excel, so we decided to implement a forecasting tool more reliable in order to better size our stock levels and reduce the associated financial costs” continues Etienne.
The sales representatives have now a role of contributor instead of generator. For many products the statistical forecast is enough, allowing to reallocate efforts on what matters.
The choice of Colibri
Among all the solutions available on the market, Eurofood chose Colibri for the following reasons:
- The SaaS mode of the solution and the short engagement period implying a win-win relation, and an optimal service for the entire contract duration;
- The simple process and the pre-packaged solution for a quick set up and ROI.
- The upgradability of the solution, “today we are using the VISION module for the forecasts, but the possibility to evolve later to a more global solution by adding new modules such as FLOW for the replenishments is very interesting” explains Etienne.
- The cost of Colibri, competitive, which of course participate in the quick ROI.
- The localization of the teams: “to have a team in Singapore with almost no time difference from us is important, we feel supported”.
- The possibility to have a prototype: “We were able to use the solution with our data before taking any decision, it allowed us to project ourselves in the solution and to convinced us in our choice”.
Encouraging first results
After 2 months of project, Eurofood is now live on the solution since the beginning of February. The prototype was used for 2 to 3 months before that, and the first results are encouraging.
« We recorded that Colibri allows a greater forecasts reliability, and this without even using corrected historics » states Etienne
For example, Etienne recorded: +11 points for the class A products, +12 points for class B and +26 points for class C on the forecasts reliability in values on all products.
« The prototype allowed us a reliability at 63%, our objective is to continue to work on the forecasts quality to reach 76% in the upcoming months. Colibri will also allow a better cross-functional activity between the teams and improve and ease the decision making » concludes Etienne Devictor.