developing demand forecasting strategies vialle.pdf · •in fmcg, demand forecasting focuses on...
TRANSCRIPT
DEVELOPING DEMAND
FORECASTING STRATEGIES
Agenda
Lactalis Group and Parmalat
Demand Forecasting in FMCG
Q & A
Agenda
Lactalis Group and Parmalat
Demand Forecasting in FMCG
Q & A
1933
1955
1968 2015
2000
> André Besnier > 1 employee > 35 litres of Milk collected /day > 17 camemberts produced / day
> Michel Besnier > 50 employee > 20 000 litres milk collected /day
> Camembert Président launch
> Emmanuel Besnier > 16 000 employee > 4th World rank in Milk collection > 66 production sites in France and
15 Outside France
> 75 000 employee > 15,6 billion litre of Milk collected per year > 237 production sites in 42 countries
LACTALIS group more than 80 years of history
2006
> Galbani acquisition > Joint-venture with
Nestlé on yogurts
2011
> Parmalat Acquisition. > Lactalis becomes number 1 in the world for Milk > 54 000 employee > 14,5 billion litre of Milk collected per year > 192 production sites in 34 countries
LACTALIS group TODAY
CA (Bio of €)
FTE
Number of Production sites
Operates in 79 countries
with
237 production sites in 42 countries
AFRICA 9 700
employees
ASIA/OCÉANIA 10 700
employees
AMÉRICAS
19 400 employees
EUROPE 35 300
employees
75 100 employees GLOBALLY
World leader for dairy products
A unique growth model: Covering all dairy professions
Breakdown of turnover by category
Other 7%
Ingredients 13%
Butters & creams 10%
Chilled dairy 12%
Liquid milk 24%
Cheeses 34%
7
Parmalat in Australia
WA
NT - PAL
QLD - PAL
SA - PFP
NSW - PFP
VIC - PAL
TAS
Darwin
Past. Milk & Juices
Bendigo
Fresh Milk, Soy products,
Yoghurts, Desserts, Sour Cream,
ESL & Juices
Melbourne (Rowville)
Past. Milk
Sydney (Lidcombe)
Past. Milk
Brisbane – Milk Ops
Past. Milk & ESL
Yoghurts, Desserts & Sour
Cream
Nambour
Past. Milk
Rockhampton
Past. Milk & Juices
Adelaide
(Clarence Gardens)
Past. Milk
Parmalat Australia Manufacturing Overview
Perth (Harvey Fresh)
Past. Milk + Yog + Juice
Melbourne
(Lemnos / Jindi)
Cheese
Melbourne (Longwarry)
Dry Milk Echuca
200 employees
Yoghurts, Desserts
Tamar
Yoghurts, Desserts
Fresh Milk site
Yogurt site
Agenda
Lactalis Group and Parmalat
Demand Forecasting in FMCG
Q & A
Key Factors
Being able to reply to the question: “ Why Do We Need to Forecast ?” Company alignment
S&OP process
Define Your Market and the Market’s Drivers Market size is different from market share
Understand / analysis macro trends
Understand competition / Pricing impact / Seasonality
Customer Perspective Collaborative planning
Scan sales ..
Population and age group Advertisement Weather... Price / individual Income Consumer’s taste and
preference Competition and Price of
Complementary goods
Short Term v Long Term
Short Term Long Term
Level Product Customer Region / State
Category Brand Technologies
Use for Detailed Plans Service Levels
Strategic Planning Capacity Planning CAPEX Budgeting
Horizon 6 months 1 to 3 years
Capabilities / Tools S&OP(CDP) process Live data Stat Models Customer collaboration
Category Management Macro Economics
Challenges
Accountability Process ownership
Skill’s
Poor Quality Data Or... too many data
New Tech
New Product Development
Forecast accuracy as part of individual performance KPI
Company Target Training Regular process reviews
Source of Data Timeliness of Data refresh Relevance Format
Increasing level of difficulty
Forecasting a New Product
Product Renovation
Line extension Sales Channel
extension Innovation
Forecasting a New Product
New, improved versions of existing products. e.g. recipe change, new labels • No change in the forecast or slight and gradual increase
factored in
• Usually same SKU used
Increasing level of difficulty
Product Renovation
Line extension Sales Channel
extension Innovation
Increasing level of difficulty
Forecasting a New Product
Product Renovation
Line extension Sales Channel
extension Innovation
Incremental innovations added to existing product lines and targeted to the current market. e.g. new yogurt flavour • “look alike” analysis
• Review with Sales of ranging and distribution (national
and store level)
• Cannibalisation can be taken into account
Increasing level of difficulty
Forecasting a New Product
Product Renovation
Line extension Sales Channel
extension Innovation
Existing products to new sales channels. e.g. extension from Grocery to Food service • Field force survey
• “turn-in orders” concept
• “Look alike” analysis
Increasing level of difficulty
Forecasting a New Product
Product Renovation
Line extension Sales Channel
extension Innovation
Radically-different products vs current offerings e.g. Lactose free Milk • Consumer study (Qualitative/Quantitative)
• Customer workshop with majors
Key Take-Away
• Be clear on the “Why”; don’t forget the customer.
• In FMCG, demand forecasting focuses on the short-term due to the nature of the products and type of industry.
• Because of the agility required, clarity on who does what and access to good quality data are key to success.
• New Product Development is a unique process – with the level of difficulties in forecasting corresponds to the availability of information and experience in the market.
Agenda
Lactalis Group and Parmalat
Demand Forecasting in FMCG
Q & A
Thanks