DS Magazine 2010

MagazineVOLUME 10 / ISSUE 1 / 2010

DS

Find out how Gloria Jean’s Coffees reduced regional inventory by 60%

Page 6

Profits

andWakeUpSmell the

demandsolutions.com2

OPENING Letter

We are all measured by the company we keep. Fortunately for Demand

Solutions, we have had the pleasure of being surrounded by some of the world’s greatest businesses for the past 24 years. While you may not know the official names of these businesses, you surely know their brands and products.

One of Demand Solutions customers Darden Restaurants, for example, owns Red Lobster, Olive Garden, Longhorn Steakhouse, among others. Hair care lines Blondie and Quantam are both brands of another

Demand Solutions customer Zotos International. Additionally, R. Torre & Company makes Torani flavored syrups used in most coffee shops, and Reckitt Benckiser manufactures French’s mustard and Woolite.

No matter where I go – across the ocean or two miles from my home – I am reminded that Demand Solutions is in good company. While attending our Australia customer conference recently, not only was I literally surrounded by customers, but every time I ventured away from the conference I saw their

“If Demand Solutions is measured by the company we keep, we have our customers to thank for making us look so good.”

products. On a quick coffee break, I stepped into Gloria Jean’s Coffees. The business dominates the Australian and Southeast Asian coffee shop scenes and after sipping on one of their steamy beverages one afternoon, I realized why – they offer high-quality products and world-class customer service. Funny enough, that is exactly what Gloria Jean’s Coffees says about Demand Solutions (page 6)!

Just yesterday at a local grocery store, I walked past a Monster Energy drink display and couldn’t help but remember four years ago when Hansen Natural, maker of the Monster Energy brand, was just beginning to introduce this exciting new product. The company looked to Demand Solutions to manage the Monster growth (pun intended) and the brand has continued to grow exponentially (page 18).

All of our customers have one quality in common – an effective supply chain management strategy. For nearly a quarter of a century, Demand Solutions has been committed to driving profitability for small and midsized enterprises through effective demand and inventory planning. Offering customers specific solutions to their specific problems is our goal. Whether it’s preparing for growth, combating poor customer service levels, excess inventory, or managing production scheduling, thousands of businesses (many with products that you see and use every day) rely on us.

By helping our customers solve their specific business problems, we enjoy a broad and loyal customer base. If Demand Solutions is measured by the company we keep, we have our customers to thank for making us look so good.

Sincerely,

Bill HarrisonPresident

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Editor: Amanda Conner / 2010

4 DS News

5 New Product Demand Solutions Advanced Planning & Scheduling �

6 Gloria Jean’s CoffeesThe Australian coffee retailer brews a global forecast with Demand Solutions �and expands its franchise business into additional markets worldwide. The socially-conscious company uses Forecast Management and Requirements Planning to filter out supply chain complexities such as long lead times, product seasonality and new product introductions. Extra large profits, coming right up!

10 Paper IslandReplenishing inventory to more than 700 retail customers has never been easier �for Paper Island with Demand Solutions Retail Planning. The greeting card and giftware manufacturer was not only able to increase sales by 30 percent, but also win the Managing Automation 2009 Progressive Manufacturing 100 Award for its auto-replenishment project with Demand Solutions.

12 Rafaella Apparel GroupThe women’s clothing designer eliminated more than USD $14 million in excess �inventory after implementing Demand Solutions in 2006. Today the company’s well-heeled demand planning process allows it to confront current economic challenges with style.

14 Woodcraft SupplySupply chain inefficiencies are no longer chiseling away at the woodworking tool �distributor’s bottom line. With the help of Demand Solutions, the company has been able to maintain the highest customer service levels in the industry despite ever-increasing lead times.

16 NisbetsNext day delivery…guaranteed. Learn how Demand Solutions helped the catering �equipment distributor gain control of its complex supply chain and deliver this challenging brand promise to its customers.

18 Hansen NaturalThe manufacturer of Monster Energy drinks has unleashed one mean supply chain �planning process with Demand Solutions. After tackling inventory management costs and energizing its inefficient production schedule, the company has almost doubled revenues in just two years.

20 MuradThe health and beauty manufacturer gets a supply chain management makeover! �Demand Solutions demand planning software has smoothed out inventory planning wrinkles and increased forecast accuracy to more than 85 percent.

22 Seymour ManufacturingFor nearly a quarter of a century, Demand Solutions has empowered the lawn and �garden tool manufacturer to dig deeper into its supply and demand streams. The company continues to rely on the software to confront modern challenges and has recently reduced inventory by an additional 15-20 percent.

TABLE of Contents


DS News

DS News

New OfficesDemand Solutions has added offices in India and Singapore along with seven new offices throughout the United States and Canada.

Fulvio Lana – AsiaLevel 42, Suntec Tower Three8 Temasek BoulevardSingapore 038988Tel: (65) 6829 [email protected]

Prasanth Atluri – India8-2-120/76, Plot # 89, 3rd FloorRoad # 2, Banjara HillsHyderabad-500 034, IndiaTel: (91) 40 [email protected]

Consumer Goods Technology selected Demand Solutions as a Reader’s Choice Award winner in the “Editor’s Pick” category.

Managing Automation also acknowledged Demand Solutions as a notable Technology Partner for empowering SKF USA and Paper Island’s inventory planning.

Managing Automation selected Demand Solutions customers, SKF USA and Paper Island, as winners of the Progressive Manufacturing 100 (PM 100) Award for their innovative projects with Demand Solutions.

For the second year in a row, Supply & Demand Chain Executive magazine awarded Demand Solutions the Supply & Demand Chain Executive 100.

Demand Solutions received the customer-nominated 100 Great Supply Chain Partners for 2009 award by SupplyChainBrain.

Supply & Demand Chain Executive magazine recognized Demand Solutions president, Bill Harrison, as one of its 2009 Provider Pros to Know.

Awards

Partner UpdateMicrosoft: Demand Solutions has attained Gold Certified Partner status in the Microsoft Partner Program with a competency in ISV/Software Solutions.

Microsoft Dynamics: Demand Solutions supply chain management software is now certified for Microsoft Dynamics. This accreditation signifies that the solution has met Microsoft’s highest standard for partner-developed software.

ePartners: Demand Solutions has formed a partnership with ePartners, a leading business and technology consultancy and Microsoft Gold Partner. Together, ePartners and Demand Solutions offer consulting and implementation services combined with the world’s most widely used supply chain planning solutions for the mid-market.

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TODAY, your manufacturing plant received an order for 450 items. The customer needed those items YESTERDAY. With Demand Solutions Advanced Planning & Scheduling, you can schedule production operations accordingly and make your

delivery date be TODAY.Demand Solutions has recently unveiled its latest addition to the Demand Solutions software

suite — Advanced Planning & Scheduling (DS APS). Demand Solutions Advanced Planning & Scheduling offers comprehensive manufacturing planning and scheduling capabilities through a powerful and easy-to-use solution. This efficient production planning tool quickly produces accurate schedules taking machines, personnel, tooling and inventory constraints into account. With the new Demand Solutions Advanced Planning & Scheduling, manufacturers are empowered to make informed decisions to meet customer demand “on-time” at the lowest costs.

With an intuitive, easy-to-use user interface built on the Microsoft.Net architecture, Advanced Planning & Scheduling has a wide range of features to help planners gain a 360-degree view of their company’s planning and production status. Top features include: • VisualScheduling: Quickly identifies bottleneck operations and allows users to move

orders around easily while accounting for constraints• PowerfulOptimizationEngine: Enables planners to schedule based on goals and

production requirements through optimization rules• Multi-UserandMulti-PlantCollaboration: Users are able to work collaboratively with

other planners and manage several schedules simultaneously• What-IfImpactAnalysis: This scenario-planning functionality allows users to predict

outcomes quickly and make informed decisions based on real and experimental schedules• Real-TimeSchedules: Provides planners with the most up-to-date information enabling

them to adjust production plans immediately• Sales&OperationsPlanning: Identifies potential inventory backlogs and shortages to

avoid lost sales

Reliable, Accurate and Easy-to-Use With Demand Solutions Advanced Planning & Scheduling, manufacturers can deliver

what they promised, when they promised it without a warehouse full of safety stock. The software allows organizations to cut costs by reducing inventory, labor costs and shipping expenses. This advanced production planning tool is perfect for small and midsized enterprises – it is affordable, easy-to-use and yields fast return on investment.

Here’s Our Delivery Date:TODAY.

Robust functionality yields robust benefits

Demand Solutions Advanced Planning & Scheduling enables the following processes:

•MaterialPlanning

• FinitePlanning

• CapacityPlanning

• ShopFloorScheduling

By enabling these processes, manufacturers are able to capitalize on the following improvements:

•Reducedproductioncycletimes

• Improvedmachineutilization

•Reducedinventories

• Increasedon-timedeliveries

• Reducedcash-to-cashandorder-to-cash cycle times

•Reducedcustomerstock-outs

Now Let’s Work on Yours.

New Product

Advanced Planning& Scheduling

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“Demand Solutions has reduced our estimated inventory by 60 percent in Europe and the Middle East,” says Wheeler. “More importantly, we have reduced our order lead times from three months down to 10 to 20 days.”

COVER STORY

Serving seven million coffees per month in Australia alone, Gloria Jean’s Coffees is known for its cozy atmosphere, friendly baristas and

high-quality coffee. With currently more than 900 outlets in 36 countries, the leading coffee retailer struggled to manage its expanding global supply chain with a rudimentary, Excel-based planning process. The company’s main business problems of managing long lead times, product seasonality and new product introductions were becoming risks that the thriving franchise organization did not want to endure.

To increase visibility into its expanding global business, Gloria Jean’s Coffees implemented Demand Solutions supply and demand planning software in 2007. The company worked with the Demand Solutions Australia office to implement Forecast Management and Requirements Planning at company headquarters in Sydney in July 2007 for management of the Australian distribution network. The subsequent roll out to Rotterdam for the European network occurred in October. The systems were implemented in less than three months at each location, delivering a return on investment in three months from the reductions in inventory achieved.

“Planning with Excel spreadsheets is a common practice for a very small business, but we were becoming a large, global company that needed more sophistication and accuracy,” says global supply chain manager Chris Muir. “I suggested that we implement

Demand Solutions because I had used it with great success at a previous company. I knew that it would be capable of handling inventory in multiple global locations for the Gloria Jean’s Coffees Master Franchise Partner network.”

With more than 600 items in its inventory ranging from bags of whole bean coffee to plastic lids, 120- to 140-day lead times were threatening to limit the company’s rate of growth in many countries. Several factors contributed to the lengthy lead times including inaccuracies within the Excel spreadsheets, the company’s historical use of Australian-only suppliers and shipping product to the international Master Franchise Partner locations directly from Australia.

Although the Australian-owned, socially-conscious coffee retailer enjoyed supporting local businesses (489 of its retail stores are based in Australia), the lead times were restricting marketing campaigns and contributing to lower sales across the international network because of lost opportunities.

With the help of its new demand forecasting and inventory management systems, Gloria Jean’s Coffees has added international suppliers and implemented several global warehouses that replenish inventory directly to the franchises. Helen Wheeler, supply planning manager, creates a forecast in Demand Solutions and compares it to the forecasts from each franchise location to determine the replenishment for its current warehouses in Sydney, Dubai and Rotterdam. The company plans to implement more central warehouse locations in Southeast Asia, India and Central/South America as its network continues to grow.

“Demand Solutions has reduced our estimated inventory by 60 percent in Europe and the Middle East,” says Wheeler. “More importantly, we have reduced our order lead times from three months down to 10 to 20 days. We have seen an increase in new outlet agreements, sales and profits as a result of our use of Demand Solutions.”

Coffee Competition is Brewing


Seasonal JoeOn a cold day, there is nothing like a hot cup of a favorite drink to warm the spirit.

Seasonality for the coffee industry is fairly consistent; the colder the temperature, the more coffee people buy, and the same is true for warm weather and cold concoctions. Though the trends were predictable, Gloria Jean’s Coffees was not able to efficiently manage them while planning with Excel spreadsheets. Demand Solutions has since completely automated the procedure. Forecast Management tracks, for example, that summertime in Australia is actually wintertime in Europe and it optimizes inventory across the hot and cold drink ranges accordingly.

Along with being able to track seasonal trends on the demand side of the business, Demand Solutions also manages the supply needed to maintain high customer service levels. When Forecast Management detects a seasonal trend, it sends a signal to Requirements Planning to replenish inventory — and even creates a bill of materials (BOM) to assist with procurement.

The BOM functionality helps the company figure out how much GJC Special Espresso Blend to make as it accounts for 40 percent of total inventory. Gloria Jean’s Coffees sells over 63 varieties of blends and flavors of coffee beans, including flavors as decadent as they sound such as chocolate macadamia, butter toffee and mocha java. The company’s coffee comes from selected plantations in more than 15 countries across the world’s coffee regions. Only the highest quality graded Arabica beans are purchased from an increasing number of Rainforest Alliance Certified Growers — meaning that not only will guests get a great cup of coffee but that cup will also be supporting local farmers, workers, their families, local communities and the environment.

The company calls it “Great Coffees with Heart” in line with its corporate values. These values include supporting local and regional causes as well as global projects such as Compassion, through which they support 350 children in the coffee growing regions of Brazil, and Opportunity International, which provides micro loans to villagers in rural Asia.

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Customer Challenge: Leading specialty coffee retailer struggled to balance demand and supply streams using an Excel-based planning process.

Mainbusinessproblems:• 120- to 140-day lead times• Product seasonality• New product introductions

Solution: Demand Solutions Forecast Management and Requirements Planning

Environment: JIWA ERP system

Results: • Reduced inventory by 60% in Europe

and the Middle East

• Reduced inventory by 25% for the core Australian market

• Increased forecast accuracy on new product introductions

• Improved ability to manage product seasonality

• Increased ability to meet International Promotional programs

Best practices learned:• Excel-based planning is risky,

inaccurate

• Use of automated demand forecasting and inventory management system increases staff efficiency and profits

• Match supply chain planning with marketing’s promotion calendar


Additions to the inventory menuFrom 1995 when Nabi Saleh and Peter Irvine bought the

Australian Master Franchisee license to today where they own the Global Franchise rights, the company has been innovating new flavored whole beans, coffee blends, and tempting hot and cold drinks for its menu. To set each new item up for success and sales, the company needed a unified strategy to coordinate marketing efforts with inventory availability. While planning in Excel spreadsheets, the International Master Franchise Partners would often receive products after their promotional marketing campaign’s planned launch dates.

The company implemented Demand Solutions to help it manage and increase sales on new product introductions. With Forecast Management’s Curves functionality, Gloria Jean’s Coffees can objectively forecast new products by replicating the demand pattern from a similar product’s introduction. By applying the new item’s actual sales to the Curve, the company can achieve inventory optimization and can align the item’s supply chain journey with the international marketing promotion calendar.

“When we introduce a new product, we are actually able to tell franchise partners when the new item or packaging will arrive in the warehouses,” says Muir. “Demand Solutions has increased our communication and information sharing, allowing our Master Franchise Partners and overall company to grow and prosper.”

“In my 15-year career of demand forecasting, I have never experienced such high forecast accuracy as I have at Gloria Jean’s Coffees,” says Wheeler.

Along with helping the company successfully launch new products, Forecast Management also empowers the company to phase out old products with its Supersession functionality. Gloria Jean’s Coffees achieves inventory optimization by closely managing product phase-outs and phase-ins with ease.

“In my 15-year career of demand forecasting, I have never experienced such high forecast accuracy as I have at Gloria Jean’s Coffees,” says Wheeler. “Demand Solutions has transformed our previously undeveloped supply and demand planning process into a best-in-class method.”

COVER STORY

Known for its friendly baristas and cozy atmosphere, Gloria Jean’s Coffees strives to be the most loved and respected coffee company in the world. And it’s not far from reaching that goal. In Australia alone, where it serves more than seven million coffees per month, no other international or local competitor has been able to break its leadership in the country’s sophisticated coffee market.

“The supply chain visibility that Demand Solutions provides has become our company’s competitive advantage,” says Muir. “Not only has the supply and demand planning software saved us working capital by reducing our lead times and increasing our planning accuracy for product seasonality and new product launches, it has given us the necessary framework to rapidly expand our franchise business globally.”

With new countries joining the Gloria Jean’s Coffees Master Franchise Partner network on an almost monthly basis, the company is confident that it will be able to support them with the help of its new planning system and international warehouses.

Aside from its improved supply chain visibility, Gloria Jean’s Coffees attributes its

Grind Distinguishing features Typical coffee-brewing method

Coarse Distinct particles. Chunky. French press. Percolator. Vacuum coffee pot.

Medium Gritty. Resembles sand. Drip coffee makers with flat bottom filters.

Fine Smooth. Particles smaller than table salt.Drip coffee makers with cone filters. Espresso moka pots.

Extrafine Very smooth. Particles finer than table salt. Espresso machines (pump or steam).

Turkish Powder-like. Resembles flour. Ibrik.

popularity to its socially-conscious business model, the make-yourself-at-home vibe every store exudes and the friendliness of its employees.

“We call it ‘Great Coffees with Heart,’” says Muir. “Our guests come to Gloria Jean’s Coffees stores across the world because they enjoy feeling welcomed and appreciated by our baristas and being part of the local community. As an added bonus, they can drink what we believe to be the best coffee in the world!”

Heating Up the Global Coffee Market

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The Daily Grind

Which grind is right for your brewing machine? To ensure a great cup of coffee, match your brewing machine to the appropriate grind.

COVER STORY

Automated Store-Level Replenishment

Wins Best-in-Class AwardWith the help of Demand Solutions Retail Planning software, greeting

card and giftware manufacturer Paper Island Ltd. transformed the replenishment of store-level inventories from a traditional and manual

process into an award-winning one that has enabled the company to optimize inventory and increase sales by more than 30 percent.

Managing Automation magazine awarded UK-based Paper Island, a subsidiary of History and Heraldry, with the distinguished Progressive Manufacturing 100 (PM 100) Award for the auto-replenishment process it established using Demand Solutions Retail Planning. The manufacturing magazine recognized Paper Island as a best-in-class manufacturer with a model supply chain — quite an honor for a company that operates in a highly competitive market where the ability to differentiate based upon supply chain efficiency is increasingly important.

Greetings to a New Auto-Replenishment ProcessPaper Island designs and produces creative greeting cards and giftware for all

occasions and seasons through its best-selling brands Fizzy Moon® and Angels at Heart®. The company sells its products to more than 700

independent retailers and several large retail chains. Paper Island launched the auto-replenishment

project after experiencing significant stock-outs at its primary customer,

one of the largest card and gift retailers in the UK.

“When we realized the stock-outs were

resulting in lost sales for both our company and

our customer, we decided to evaluate the entire inventory

planning and replenishment process from start to finish,” says director of operations Phil McNulty.

Historically, Paper Island’s primary customer replenished

its greeting cards using the traditional stock notification ticket placed behind the

cards in the greeting card pocket. When stock levels reached a certain point,


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“Sales of cards and gifts for the Christmas season were approximately 34 percent higher than previous years,” says McNulty. “Although the quality of designs and products were improved, we believe that the sales increase was largely because of Demand Solutions Retail Planning.”

store staff manually pulled the stock notification ticket and replenished the card pocket with more greeting cards. When Paper Island discovered that tickets were becoming misplaced or lost and not being pulled in time to replenish cards before stocks were exhausted, the company decided to search for a more efficient and automated replenishment process that would guarantee its greeting cards would remain on its primary customer’s shelves.

Because Paper Island already utilized two of Demand Solutions supply chain management systems, Forecast Management and Requirements Planning, implementing Demand Solutions Retail Planning was a natural fit for the company to address its store-level inventory planning problem. Demand Solutions ability to optimize store-level replenishment using point-of-sale (POS) data was just what Paper Island needed to streamline and automate the inventory replenishment planning process. Paper Island implemented Retail Planning in just 10 days. After experiencing overwhelming success at the initial 10 pilot stores, the company continued to deploy the software in additional stores. Today, the program is fully functional in 350 of the major UK retailer’s branches.

Something to CelebrateSince implementing the new software, Paper

Island has achieved substantial results. Most notably, the company has reached its goal of reducing stock-outs and increasing sales. “Shortly after we implemented Demand Solutions, like-for-like sales of our main brand Fizzy Moon® were 44 percent higher in the stores being auto replenished through

Demand Solutions than in the non auto-replenished stores,” says McNulty.

Sales for seasonal items have also increased. Demand Solutions ability to control seasonal challenges was first tested during Christmas, Paper Island’s largest sales season. By the end of the season, Paper Island was celebrating its inventory planning success. “Sales of cards and gifts for the Christmas season were approximately 34 percent higher than previous years,” says McNulty, who credits the jump in sales to Demand Solutions. “Although the quality of designs and products were improved, we believe that the sales increase was largely because of Demand Solutions Retail Planning.”

In order to effectively manage these seasonal spikes in demand, it is imperative that operations run smoothly inside Paper Island’s manufacturing and distribution center in Rotherham, as it is the cornerstone of the company’s supply chain. With the help of Demand Solutions, Paper Island has been able to refine its operations within the center. “After implementing Demand Solutions Retail Planning, our ability to schedule and manage work through our warehouse has significantly improved,” says McNulty. “The warehouse now works to a repeating weekly cycle, allowing the gearing of warehouse resources to meet the growing demand for our products.”

Replacing the time-consuming and ineffective replenishment process with a new automated one powered by Demand Solutions was a smart decision for Paper Island. The company has created a mutually profitable relationship with its primary customer and has gained a significant competitive advantage. “Our decision to invest in the auto-replenishment process with Demand Solutions Retail Planning software has not only redefined our supply chain but has allowed us to reinforce our position as a first-class supplier.”

Paper Island

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Successful Custom

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Manual Planning Processes Are So Last Season

In a stable economy, manufacturers in the apparel industry must manage the delicate balance between inventory and out-of-stocks while factoring in size, fit and color variations,

lead times and sourcing pressures. During a recession, forecast management and inventory planning is infinitely more complex. One of the many companies dealing with the added pressures of the economic downturn is Rafaella Apparel Group, Inc., a designer, sourcer and marketer of women’s clothing since 1982. Along with the usual challenges, the company must also account for record declines in consumer spending and the threat of its suppliers and retail customers going out of business.

Known for providing functional and fashionable clothing for women’s work and life wardrobes, Rafaella Apparel Group was fortunate to have a supply chain management system in place when the economy began to deteriorate. The company implemented Demand Solutions supply chain management software three years ago, empowering it to eliminate USD $14 million in excess inventory — the result of its previous, manual inventory planning process.

Its old planning process that had led to a more than 40-week supply involved one planner, 20 hours per week, a calculator and endless stacks of paper. Without any manage-by-exception capabilities, the previous planner spent several hours each week reviewing the forecast line by line for each item. So when that planner left the company and all of the knowledge about Rafaella Apparel Group’s inventory planning went with him, the company hired a dedicated planning professional and began evaluating automated supply chain management systems that would propel its profits.

Sean Carolan, director of retail planning and replenishment, joined Rafaella Apparel Group in 2006 to lead its forecast management and inventory planning. Carolan along with Rafaella Apparel Group’s CFO compared several software programs and chose Demand Solutions because of the simplicity it offered to the complex business.

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Rafaella Apparel Group

“We especially liked that Demand Solutions had all the functionality we needed without the bloated price tag common for most supply chain management software,” says Carolan. “Other systems we evaluated offered functionality that we didn’t need with a higher total cost of ownership and longer implementation times.” The company implemented Demand Solutions Forecast Management and Requirements Planning in two weeks to manage the demand forecasting and inventory replenishment of its bottoms business (pants, skirts and shorts).

Excess Inventory is oh-so Unflattering

Rafaella Apparel Group quickly transitioned from a manual process to a systematic one. The new forecasting and inventory management systems provided visibility into the entire supply chain, resulting in demand forecasting accuracy, optimized inventory planning and a new sense of accountability for employees. Better yet, the $14 million in excess inventory, or enough inventory to sustain an entire year of customer orders, rapidly melted from the company’s bottom line and it reached a return on investment within months.

“Three years ago, our company thought that it was effectively managing its inventory, so it was quite a shock when Demand Solutions identified an excess of $14 million,” says

Carolan. “Though the reality was difficult to digest, Demand Solutions kept our inventory problem from spiraling out of control and helped us take deliberate action in advance of the recession.”

Layers of ComplexitySince mid-2008, the economic downturn

has added a layer of complexity to the company’s well-heeled inventory planning process. Specifically, the threat of vendors and retailers going out of business has made Carolan’s job more like a financial reporter’s.

“The recession is forcing us to focus on every account because we run the risk of retail customers and suppliers going out of business at a moment’s notice,” says Carolan. “We actually have placed orders with companies and they’ve filed for bankruptcy days later. You never know, so you have to be attuned to their businesses as much as you are your own.”

To do this, Carolan keeps an eye on the news and an ear to the phone to make sure he doesn’t miss a stitch of information that could add to the company’s supply chain management process. The key is having as much information as possible, says Carolan, who previously discussed order amounts and product lead times with customers and suppliers, not the financial security of their businesses.

Forecast management has been another main struggle for Carolan during

“Three years ago, our company thought that it was effectively managing its inventory, so it was quite a shock when Demand Solutions identified an excess of $14 million,” says Carolan. “Though the reality was difficult to digest, Demand Solutions kept our inventory problem from spiraling out of control and helped us take deliberate action in advance of the recession.”

the recession because last year’s sales will surely not repeat themselves. Previously, Carolan used historical sales data in Demand Solutions Forecast Management to develop a system forecast and then he incorporated in the sales representatives’ forecasts. Before the recession, the demand forecasting process was mostly automated.

“Inventory planning in a recession is like working in fast forward,” says Carolan. “By the time the system or anyone can detect a demand trend, it changes. Because Demand Solutions planning methods are not solely based on statistical equations, we can incorporate our own intelligence — which has proven to be critical in recent months.”

Fashionably Functional Inventory Planning

Although the recession has impacted Rafaella Apparel Group’s sales figures, the company is in a good position to ride out the tough times ahead. It has a solid planning process in place with Demand Solutions and its Rafaella brand is positioned as the entry-level price point, priced approximately 20 percent below competition, in sportswear departments of department stores.

“Our brands are fairly resilient,” says Carolan. “Rafaella clothing is designed to fit into women’s multifaceted lives. I’m not a fashion guy but recession or not, women will always need that perfect pair of black pants.”

Woodcraft Supply

Ingraining Inventory Planning into the Business

Supplying woodworkers with superior woodworking products and expert advice since 1928, Woodcraft Supply, LLC has expanded far beyond the initial one-room shop in

Boston, Mass. The company now sells woodworking tools and supplies through 87 franchised retail stores in the United States, its website and its catalog that is distributed in all 50 states and 117 countries. Demand Solutions facilitated Woodcraft Supply’s extensive growth by helping reduce inventory, cut costs and increase profit margins.

“We were a USD $10 million company in 1994 with five stores, and now we’re between $100 and $300 million with almost 90 stores,” says vice president of distribution and purchasing Jerry VanCamp. “Demand Solutions supply chain management software enables us to keep up with our rapid growth rate by

managing our inventory in a way that reduces expenses and increases profits.” The company has been using Demand Solutions Forecast Management and Requirements Planning software for more than 14 years to help with its demand planning, inventory planning and replenishment.

With only one distribution center in West Virginia replenishing each of the retail outlets, Woodcraft

Supply has to precisely manage its inventory to avoid stock-outs and maintain high customer

service levels. The company accomplishes this by planning at the corporate level; planners at the corporate office generate demand forecasts and perform inventory planning for each store. To

achieve this, planners download the franchise’s sales figures daily and analyze the data on a monthly basis to improve each store’s supply and demand planning in order to optimize inventory at the distribution center.

While Woodcraft Supply distributes woodworking tools and supplies, it also performs light assembly and kitting from components manufactured in the United States and overseas — a combination that adds complexity to the planning process. Demand Solutions Requirements Planning helps establish accurate inventory planning that takes into account lead times, product seasonality and the many constraints on inventory management. The ability to manage product lead times is especially important because some items have lead times of one year or more.

Adding complexity to the forecast are Woodcraft Supply’s diverse marketing channels. As its marketing landscape has evolved, managing three sales channels — retail, catalog and online — has become a multifaceted task. In 1992, catalog sales were 80 percent of the company’s business, but today, retail stores generate a significant percentage of the company’s sales. In order to effectively adapt to this change, Woodcraft Supply uses Forecast Management’s Aggregation/Proration feature to examine its sales data on a variety of levels.

New product introductions are often a company’s biggest challenge, but Woodcraft Supply manages them with ease by utilizing Demand Solutions Forecast Management. VanCamp depends on the demand planning software’s Curves feature to generate forecasts for new products that do not have historical sales data. “Demand Solutions ability to predict how products might perform has been critical to our growth and continued success,” says VanCamp. Using the robust Curves functionality, Woodcraft Supply has been able to successfully introduce from 500 to 1,000 new items each year.


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Customer’s Pick: Favorite Demand Solutions Functionality

Aggregation/Proration • Allows users to view data at any detail

level within Forecast Management. With this functionality, Woodcraft Supply can look at the data on a company level and then arrange it in a more detailed view by region, store or product.

Curves • Objectively forecasts new products

by cloning the demand pattern from similar products within Forecast Management. This powerful feature responds quickly and dispassionately to each new product’s initial sales. Woodcraft Supply employs Curves for visibility into a product’s demand that has no sales history.

Lead Time • Allows users to establish order

parameters for each product in each location within Requirements Planning. This functionality automatically incorporates Woodcraft Supply’s elongated lead times due to offshore manufacturing into the inventory planning process.

Exponential Smoothing Formula • An algorithm within Forecast

Management that incorporates more recent sales history to account for temporary dips in the market.

Woodcraft Supply is using this feature

to help forecast customer demand

during the economic downtown.

By aggregating its sales channels’ data into a high-level view, Forecast Management has allowed Woodcraft Supply to vigilantly monitor its inventory levels. Prior to implementation, inventory levels were growing faster than sales, inventory turns were decreasing and customer service levels were declining.

“When I started using Demand Solutions in 1995, we were a $10 million company. However, $3 million of that value was invested in inventory,” says VanCamp. “With the help of Demand Solutions, we anticipated that we would have to stock $10 million in inventory in the near term to keep up with our 10-15 percent per year growth rate. Today we keep about $9-11 million in inventory and we are over $100 million in revenue. That is a testament to how well we have been able to manage our inventory with Demand Solutions.” Additionally, the company has increased inventory turns from 1.5 to over five per year.

Now, Woodcraft Supply manages an optimized inventory while maintaining high service levels. “Every year since implementation, our service levels have increased. Our customer service levels are now the highest in the industry,” says VanCamp. “We have Demand Solutions to thank. The software seamlessly balances service levels and inventory for the most profitability.”

More Than a ToolAchieving a competitive advantage when

the economy is strong is one thing. Woodcraft Supply has gained significant market share during the economic recession

because of its use of Demand Solutions to reduce expenses and maintain high service levels. One of its inventory planning strategies with Demand Solutions Forecast Management has been to utilize formulas within the demand planning software that are more suited for recognizing downward sales trends. The Exponential Smoothing algorithm incorporates more recent sales history, providing greater visibility into customer demand during unpredictable economic times. “Unlike a lot of systems that have simplistic, purely mathematical demand forecasting formulas, Demand Solutions has sophisticated algorithms that take into account multiple factors and incorporate our business intelligence,” says VanCamp.

For VanCamp, Demand Solutions has provided more than a solution to Woodcraft Supply’s business problems. “Throughout my career working with Demand Solutions, I have been able to share my inventory planning experiences with other Demand Solutions customers and learn from their experiences as well,” says VanCamp. “When you implement Demand Solutions, you are not just another customer. You are a member of a larger community that you’re able to engage with to share best practices and lessons you’ve learned along the way.”

Hammering Out Complexities

Nisbets

Consider the following scenario. It is 4:30 on a Friday afternoon. Your restaurant is catering a wedding for 200 guests tomorrow and your

Imperial 8-Burner range just quit working. How will you ever get a new range in time to prepare the meals? You remember that Nisbets, the UK’s largest catering equipment distributor, guarantees next-day delivery. You log on to their website and complete your order before 5:00 p.m. Now you can relax knowing the range will be delivered in time to meet your approaching deadline.

Next-day delivery is a demanding guarantee for a company managing a complex supply chain, but

with the help of Demand Solutions Forecast Management and Requirements

Planning, Nisbets is able to forecast demand and stock inventory accordingly in order to deliver this

challenging promise to its customers, which include large

restaurant chains, hotel chains, hospitals and schools.

Catering to Long Lead TimesSupplier Fulfills Next-Day Delivery Guarantee

Supply Chain Prep WorkThe B2B catering equipment distributor

purchases all of its 13,000 products, which include everything from chef’s jackets to heavy duty catering equipment, from suppliers around the world. Because of this, Nisbets juggles varying lead times that range from a single day up to six months. Accurate demand planning is extremely important to ensure Nisbets can deliver on its next-day promise and avoid excess inventory that would tie up working capital.

In 2006, this balancing act became too difficult to manage using Excel spreadsheets. Nisbets needed a more sophisticated solution to manage its multifaceted supply chain and rapidly growing business in order to sustain its leading market position.

After assessing the functionality and cost of several supply chain management systems, Nisbets came across Demand Solutions while searching the web for a demand planning solution. “We chose Demand Solutions because it offered all of the powerful functionality that we needed at an affordable price,” says inventory control manager Matthew McMahon. “A critical factor in our demand planning software evaluation was total cost of ownership. Demand Solutions clearly emerged as the value-priced solution as its implementation is often within 90 days and its yearly maintenance fees are the lowest of the supply chain management software industry.”


DS Magazine 17

“A critical factor in our demand planning software evaluation was total cost of ownership. Demand Solutions clearly emerged as the value-priced solution as its implementation is often within 90 days and its yearly maintenance fees are the lowest of the supply chain management software industry.”

Nisbets

Appetizing Results “We were able to reduce our inventory by 19

percent — 1.9 million pounds (USD $3.1 million) — in just seven months after implementing Demand Solutions,” says McMahon. “We experienced a full return on investment in just a few months by optimizing our inventory alone.”

The most visible impact of Demand Solutions was the optimization of the company’s product mix. The software immediately identified those items that were overstocked and those that required immediate purchasing action. For example, Nisbets was previously carrying six weeks worth of safety stock for its second-best selling product, tea towels. Demand Solutions, through its Service Level Optimizer utility, recommended that the company keep only two weeks worth of tea towels — a significant stock decrease.

“We were initially skeptical of the reports from Demand Solutions because we assumed we needed to store a lot of extra inventory in order to keep our brand promise,” says McMahon. “After noticing that stock-outs continued to decrease even with the safety stock reduction, our team put full faith in Demand Solutions.” In fact, out-of-stocks reduced from 4 percent to 1.5 percent — an acceptable percentage considering the company distributes many low-selling items such as kitchen accessories and spare parts that are difficult to forecast.

Serving Up a Seasonal ForecastAlong with reducing inventory and out-of-stocks,

Demand Solutions has identified the seasonality of many of Nisbets’ products. Prior to Demand Solutions, McMahon suspected that certain products were

seasonal, but it was too difficult for him to pinpoint which ones while using spreadsheets for demand planning. With Demand Solutions graphs and charts, seasonal items are easy to identify. Some products such as barbeques, ice makers and ice-cream machines, are clearly seasonal during the summer months, but as a surprise to McMahon, Demand Solutions identified that other ordinary items are also seasonal. Everyday utensils such as forks, knives and plates are seasonal with a strong volume build in the months leading up to Christmas and New Year’s.

In addition to forecasting seasonal demand, McMahon’s favorite functionality in Demand Solutions Requirements Planning is the scenario-planning ability. If Nisbets receives a “killer” purchase order, McMahon is immediately able to detect how that order will impact future inventory, service levels and potentially the company’s bottom line. This provides Nisbets with the information necessary to negotiate the order with the customer instead of filling it without knowing the resulting consequences.

Since its inception 25 years ago, Nisbets has grown into a thriving company with a strong brand promise. In the past five years alone the company has grown 19 percent; McMahon credits this expansion partly to Demand Solutions. “In 2007, after using Demand Solutions for just one year, we added operations in Spain and France and a consolidation warehouse in China,” says McMahon. “We intend to continue on this path of growth and expand into other parts of Europe in the future. And I am confident that Demand Solutions will be a key enabler in helping us achieve that dream.”


Hansen Natural

onster Growth

Providing chilled, liquid energy for millions of lethargic consumers, Monster Energy drinks have stimulated revenues for its parent company

Hansen Natural Corporation. Since the launch of the Monster Energy brand, Hansen Natural has grown spectacularly — revenue has almost doubled since 2006. A leading marketer of all-natural alternative beverages, Hansen Natural manufactures and distributes energy drinks, smoothies, juices, teas and sodas to grocery chains, wholesale clubs, distributors and foodservice operators.

The California-based company implemented Demand Solutions in 2005 to accommodate the rapid growth of its Monster Energy brand. Because of the software’s successful management of Monster Energy, Hansen Natural uses Demand Solutions to handle the supply and demand planning for all of its products. Since implementation, the supply chain management software has become an integral ingredient to the company’s continued success by reducing inventory-related expenses, increasing sales and customer service levels, and enabling profitable decision-making.

Prior to Demand Solutions, Hansen Natural had no dedicated planning or production scheduling system and attempted to manage its supply chain through a series of spreadsheets. In this process, historical data was not incorporated into the estimate, and without tracking the necessary statistics, the company could not reliably forecast demand. As the Monster Energy brand gained market share, Hansen Natural needed to improve its supply chain management and demand forecasting in order to quench its customers’ thirst. Tim Hayes, vice president of operations, had used Demand Solutions at

a previous company, James Hardie, and recommended Demand Solutions Forecast Management and Requirements Planning as the answer to Hansen Natural’s demand forecasting and production and inventory planning problem. “I chose Demand Solutions over the other supply chain management software that we evaluated because it’s a best-in-class solution at an incredible value,” says Hayes. “Based on my previous use of Demand Solutions, I knew it could solve all of our challenges including dynamic growth, international market introductions, product line extensions and meticulous production schedules.”

Stimulating a New Production MatrixTo cut inventory-related expenses, the company’s planners

worked closely with Demand Solutions local representatives to create a localized

production matrix. In order to create the new production schedule, the company segmented its customer base by geographic region and associated each region to the closest plant. Utilizing the new streamlined production matrix, the regional plants receive their production requirements based on their regional customers’ demand. “We have reduced our carrying costs by scheduling

production based on what we need, not what we think we need,” says Hayes.

The new production schedules and forecasts have not only increased Hansen Natural’s efficiency, but also cut freight costs.

According to Gina Gutierrez, manager of demand planning, “We were making product on the West Coast (U.S.) and shipping it to the East Coast and everywhere in between. Demand Solutions Requirements Planning has tightened the entire process and dramatically reduced our overall inventory expenses.”

Alert to SeasonalityHansen Natural also increased sales and customer service

levels by effectively managing product seasonality. According to Gutierrez, each of Hansen Natural’s product lines have distinct

along with inventory planners can supplement their knowledge with the system’s insight into demand trends of a new product. In the early planning stages of new product introductions, Hansen Natural’s forecasting team and marketing department monitor the software closely, choosing to manually review every forecast. Once the sales data is available, the planners confidently let the software take over. This process has proved effective as Hansen Natural has successfully extended the Monster Energy drink line to include 15 different flavors, such as Khaos, M-80, Mixxd and Assault.

Growth That Doesn’t TireWith Demand Solutions, Hansen

Natural managed the increasing demand of its Monster Energy brand and now enjoys an efficient, regional production schedule that reduces expenses. “The monetary success of our Demand Solutions purchase is difficult to identify as our company’s sales have grown over 70 percent since 2006,” says Hayes. “I look at it this way — we grew from around five plants to more than 35 plants in just a few years. With Demand Solutions, we have been able to handle the increased complexity of our production scheduling while only employing one additional planner.” With such efficiency with Demand Solutions, expect Hansen Natural and the Monster Energy brand to continue to have energy in the years to come.

Which Monster suites you?Monster Original

packs the original high-energy Monster brew with the classic Monster flavor.

Monster Lo-Carb is a low-calorie and low-carb version of the original Monster Energy brew that packs the same energy punch as the original.

Monster Khaos blends 50 percent juice (apple, orange, pear, peach, tangerine, pineapple and white grape juice extract) with the original Monster taste and classic buzz.

M-80 infuses the Monster brew with 80 percent tropical juices (apple, passion fruit and pineapple juice concentrate) for an explosive flavor with a punch of energy.

Mixxd throws 30 percent juice (apple and red grape juice concentrate) into the original Monster energy-blend.

Java Monster Originale charges premium coffee and cream with the Monster energy-blend for a supercharged energy drink with half the caffeine of regular coffee.

Java Monster Irish Blend is a non-alcoholic version of a classic coffee cocktail infused with the original Monster buzz.

sales trends. For example, Junior Juice and Juice Slam juice boxes are in high demand when school is in session, while the 8oz. Natural Soda Mixers are more popular during the holiday seasons. In the high-volume energy industry, juice-based energy drinks such as Rumba, which is made of 100 percent juice, have higher sales during the spring and summer, while energy drinks that contain dairy — such as Java Monster, an energizing mix of premium coffee and cream — are in higher demand in the late summer and early fall.

To manage the diverse seasonality of each product, Gutierrez utilizes Demand Solutions Forecast Management, which automatically accounts seasonality into each product’s forecast to create a reliable and highly accurate demand projection. Then, planners adjust safety stock levels accordingly at the more than 35 plants and warehouses located in the United States, optimizing Hansen’s inventory levels.

“Without such an innovative planning tool, we would have an incredibly difficult time managing all of our plants,” says Gutierrez. “Because we implemented Demand Solutions, we are able to get a complete and clear picture of our business.” By managing product seasonality, Hansen Natural is able to supply customers with the products they want and avoid missing sales opportunities due to out-of-stocks.

Unleashed SalesManaging new product introductions is a

common challenge for inventory planners and prior to Demand Solutions, Hansen Natural didn’t have the information necessary to make profitable decisions. Now with Demand Solutions Forecast Management, executives

19DS Magazine

Murad

Health and beauty manufacturer Murad, Inc. produces creams and serums that solve a variety of health problems such as genetic and

environmental aging, acne, redness and sensitivity, and cellulite. While the company investigated innovative solutions to help its customers with their health needs, it explored options to improve its inventory planning and demand forecasting processes.

The privately-owned company focused on enhancing its inventory situation, including demand planning for thousands of SKUs in its diverse sales channels, managing product seasonality and introducing

new products to the market. To maximize customer service, brand loyalty and effectively utilize company resources, Murad implemented Demand Solutions Forecast Management software.

Beautifying the ForecastFounded in 1989 by Howard Murad, M.D., Associate

Clinical Professor of Medicine at UCLA and a leader in skincare science, Murad, Inc. is known for developing products that use scientifically-proven methods to keep skin looking young, healthy and vibrant. Over the years, Dr. Murad and a team of scientists have created thousands of innovative health and beauty products that the company markets through four diverse sales channels: national, professional, direct and international. The national and professional channels each account for 20 percent of Murad’s business and sell products to major retail stores in the U.S. such as Sephora and Ulta and to beauty salons in the U.S. Through its direct channel, Murad sells directly to end consumers via its website, catalog and infomercials. Lastly, the international channel sells product to a growing list of countries around the world, including the UK, Canada, Japan, Turkey, Israel and Mexico.

The decision to implement Demand Solutions in 2006 allowed Murad directors to balance the different channels

and view each market segment’s preferences while maintaining superior customer service with optimized

inventory levels. Because Murad’s channels, as well as customer demand, varies depending on the product, time

of year and geography, the company has gained major insight into inventory control and planning efforts have become streamlined.

Transforming Skincare™ Through a Transformed Supply Chain

Demand Solutions Forecast Management has helped Murad to manage its channels as four separate businesses. With its new demand forecasting software, the company is able to aggregate the demand for its sales channels through Forecast Management’s easy-to-use Aggregation/Proration feature. With this capability, Murad can view all sales data for the entire company and then examine each sales channel

individually. Forecasting manager Jorge Morlote, who joined the company shortly after implementation, says that he cannot imagine managing Murad’s thousands of records without the feature, which presents both a broad and detailed view of the business.

As a foundation for inventory planning, Murad uses Demand Solutions Forecast Management with its

Oracle ERP system. Morlote creates the initial forecasts


in Forecast Management and then has each sales channel’s director add real-world insight into the forecast. “Forecast Management allows us to incorporate indispensable outside knowledge such as distributor forecasts, managerial overrides and anecdotal notes about future developments,” says Morlote. “The ability to incorporate real-world insight along with the statistical formulas ensures the most accurate, quality forecasts.” This flexibility allows the sales channels’ directors to account for each product’s popularity, which changes dramatically depending upon the marketing channel and brand objectives.

Along with managing a high SKU volume in multiple sales channels, Demand Solutions also empowers Murad to effectively manage product seasonality, especially for its sun protection items that have an increased demand from March to June. The demand forecasting software accounts for this seasonality without many manual adjustments and has allowed Murad to prepare its inventory planning appropriately for the summer months and reduce stock-outs. “In the past year and a half, Forecast Management has maintained an overall forecast accuracy of 85 percent or better,” says Morlote. “We know that the high forecast accuracy has optimized our inventory levels and minimized unnecessary expenses.”

Revitalizing New Product IntroductionsIntroducing new products to the market — or to four different markets — is a challenge

that Murad constantly encounters as it innovates new beauty treatments, such as Active Sun Radiance Serum, the company’s latest sun damage remedy that is receiving outstanding reviews. When introducing such new products, Murad often uses Demand Solutions Forecast Management’s Curves feature to create a product forecast by cloning the demand pattern of a similar item. By combining the demand planning software’s objective predictions for new product sales along with managerial expertise, Morlote is able to forecast the demand for new products as accurately as possible.

By taking into account the many factors that affect inventory planning, Murad was able to minimize expenses while maintaining high customer service levels. “Utilizing Demand Solutions demand planning software to improve our forecast accuracy has resulted in lower inventory levels, which directly impacts our bottom line.”

According to Morlote, Demand Solutions Forecast Management software meets Murad’s needs while still being manageable for employees to use. “I have planned in Excel spreadsheets and in the most complex supply chain management software and have found that Demand Solutions performs every function that a small-to-midsize enterprise needs in a logical, understandable way.”

Murad’s Award-Winning Product PortfolioMurad Intensive Wrinkle Reducer for Eyes – SELF Magazine Healthy Beauty Awards 2009: •BestAnti-AgingEyeTreatment

Murad Age Spot and Pigment Lightening Gel – InStyle Best Beauty Buys 2009: •BestSpotLightener

Murad Redness Therapy Correcting Moisturizer SPF 15 – Celebs On Sunday UK Beauty Awards 2009: •SoothingFaceCreams

Dr. Murad Energizing Pomegranate Lip Protector SPF 15 – Elite Bride Editor’s Choice 2009: •Top10BeautyPick

Murad Age Reform Intensive Resurfacing Peel – Star Superstar Beauty Awards 2009: •BestFacePeel

Murad’s beauty innovation goes beyond beauty products, the company also offers a world-class, award-winning Medical Spa. Services include:

• Muradsignaturefacials

• Salonservices

• Massageandbodytreatments

• Specialmonthlyevents

Visit www.murad.com to learn more

2121DS Magazine


Seymour Manufacturing

In 1987, after reading Bernie Smith’s revolutionary inventory planning book, “Focus Forecasting,” Steve Fletcher was

inspired. The idea of using statistical formulas to forecast customer demand intrigued him and

he was determined to achieve such inventory planning accuracy at his company Seymour

Manufacturing. The company’s ERP consultant, David Buker Company, encouraged Fletcher to contact Steve Johnston, founder of Demand Solutions, because Johnston had developed

demand forecasting software based on the “Focus Forecasting” principle.

“We didn’t even have a personal computer yet, but I called Steve Johnston to talk to him about implementing Demand Solutions Forecast Management software,” says Fletcher. He then discussed the benefits of the software with Seymour Manufacturing’s then sales

manager, Mike Campbell, who later moved to St. Louis to become president of Demand Solutions. Within the year,

Seymour Manufacturing was the third company to implement Demand Solutions

Breaking Ground with Forecast Management

Seymour Manufacturing purchased its first personal computer, implemented Demand Solutions and became the third user of the software.

Now, nearly 25 years later, Seymour Manufacturing continues to rely on Demand Solutions as it has become a cornerstone of the company’s entire business. Over the years, Seymour Manufacturing has grown substantially and the software has evolved with it. “At the time, we were forecasting a couple hundred items,” says Fletcher. “We would start the forecasting process in Forecast Management on a Friday afternoon and let the system run over the weekend so the forecast would be complete by Monday morning. Then, we would print the forecast from Demand Solutions and manually key in the data into our ERP system. It was time consuming, but we didn’t know anything different back then so we thought it was pretty advanced.” Luckily for the company’s long-time master scheduler, Brenda Jackson, generating a forecast for more than 3,000 items now only takes about two minutes.

From Wagon Wheels to ShovelsSeymour Manufacturing has come a long way since its

days as the premier manufacturer of wagon wheel spokes and hubs in the late 1800s. Today, the company is booming with four manufacturing plants producing thousands of products such as shovels, rakes, hoes and posthole diggers as well as the world’s best fiberglass lawn and garden tools. The company has successfully adjusted its product line to meet the modern needs of its customers. However, the manufacturer has not lost sight of the standardized nature of its products. “We sell products that dig in dirt,” says Fletcher. “A shovel is a commodity, it’s one of the oldest tools that humans have. So we must provide superior quality at a very competitive price.”

Seymour Manufacturing uses Forecast Management to confront this challenge and several others including long lead times, late-shipment fines, stiff competition, as well as the current recession. The company must juggle inconsistent lead times that result from using a combination of in-house and offshore manufacturing. Manufacturing products in the company’s U.S. plants takes three to five days. In contrast, items manufactured offshore have longer lead times — typically 90 days. Because Seymour Manufacturing is penalized for shipping items late to some retail customers, prompt delivery is vital. The company competes in a fierce market consisting of only a few tool manufacturers; Fletcher attributes the company’s success and its ability to face these challenges to its strong history and dedicated team as well as the advanced technology that Demand Solutions Forecast Management software provides.

During a time of uncertainty in today’s economy, Seymour Manufacturing is confident it can emerge from the recession on top. “The companies that will go out of business will be the ones that don’t manage their inventories properly,” says Fletcher. With the help of Demand Solutions, the company is equipped with the tools it needs to manage its inventory and combat the perils of the current economy. Recently, Seymour Manufacturing reduced

“We’ve been using Demand Solutions for so long that it has become integrated into almost every function of our business,” says Fletcher. “Because of the software, we don’t have the barriers between manufacturing, sales and marketing like some companies struggle with.”

its inventory by 15-20 percent to free up working capital. “We’ve been doing this for over 20 years,” says Fletcher. “What keeps us competitive is that we maintain high standards for customer service. And customers do appreciate that.”

Ground-Breaking ResultsUtilizing Demand Solutions has not only helped

Seymour Manufacturing overcome challenges, but the software has allowed the company to create cross-functional collaboration among its departments. “We’ve been using Demand Solutions for so long that it has become integrated into almost every function of our business,” says Fletcher. “Because of the software, we don’t have the barriers between manufacturing, sales and marketing like some companies struggle with. Demand Solutions gives a transparent view of our business and therefore mandates that every person in every department is accountable — there is no hiding place, there is no incentive to point fingers.” Demand Solutions has also enabled Seymour Manufacturing to create detailed customer portfolios that allow the company to better manage its customer relationships. “We have so much customer information within Demand Solutions. It’s a great tool for us to gather and share information. Just that aspect of it is invaluable,” says Fletcher. “Sometimes we know more about our customer’s historical sales than they do.”

“I could not possibly quantify the savings we have experienced through the use of Demand Solutions Forecast Management,” says Fletcher. “But what I do know is that the software has propelled us over the course of 20 years to make smart decisions that have guided our business to where it is today.”

23DS Magazine

We’ve Got You Covered.

How will we get this rush order

out the door?

Where do we have slack on other orders?

Can we leverage alternate machines?

With so many factors to consider, what’s the

optimal solution?

Advanced Planning& Scheduling

Demand Solutions understands that when it rains...it pours. It’s great when you land that big production job, but there are hundreds of details to be worked out in order to ensure you deliver on-time. That’s where Advanced Planning & Scheduling from Demand Solutions comes in.

• Streamline workflows to minimize lead times and in-process inventory. • Gain visibility into potential bottlenecks that could slow you down. • Keep your key customers happy without getting your feet wet.

Visit us at demandsolutions.com/aps-knowledge-center or call 1.800.886.3737 for more information.

Can we avoid adding overtime?

DS Magazine 2010

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