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Infor have announced that AB World Foods, a division of Associated British Foods (ABF) has completed the first phase deployment of Infor Supply Chain Management (SCM). Infor SCM Demand Planning, Infor SCM Inventory Planner and Infor SCM Replenishment Planner will help AB World Foods build a foundation for managing its global supply chain, enabling the food manufacturer to predict and shape customer demand with greater accuracy.
As part of an integrated business planning strategy, AB World Foods will use Infor SCM solutions to define the demand, inventory and replenishment requirements of its global operations. This will include products manufactured by AB World Foods as well as stock manufactured by third parties.
Prior to the implementation of Infor SCM, divisions of AB World Foods such as G Costa used spreadsheets based on retrospective sales performance over the previous two months. This process provided a flat forecast of demand and did not take into consideration the different demand patterns for various types of products. Consequently AB World Foods suffered expensive overstocking of some brands and inadequate supplies of others.
AB World Foods chose Infor SCM following an extensive review of the market. AB World Foods was impressed by Infors professional services team, and Infor SCM scored highest on the basis of functionality and a lower total cost of ownership (TCO).
AB World Foods is building its supply chain around Infor. We have already consolidated our enterprise applications onto Infor ERP BPCS and this new demand forecast will help manage a lot of our business, explains Gary Brookes, head of supply chain, AB World Foods. Given that around 75 percent of our costs are supply chain related, that is a huge responsibility.
Throughout the phased implementation, we have seen some profound benefits. In the case of inventory planning we have already increased our service levels from 91 percent to 96 percent. Recently we have surpassed our target of 98.5 percent. In addition we have reduced our stockholding of finished goods by approximately 20% - a financial saving of over 2m.
The sales and marketing teams used to be somewhat out of step with the supply chain department. By integrating demand planning with our stock plans we have significantly improved sales and risk reporting. This has served to bring the two teams together and improved communications between the disciplines.
Looking forward, AB World Foods plans to use Infor SCM to improve supplier relationship management and develop strategic demand forecasts for the next 12 and 24 months. This will help to guide stock replenishment action.
Given the specialist nature of some of the AB World Foods portfolio this can become a critical cost issue. In the past, limited availability of certain products or ingredients has affected profitability, explains Brookes. When a shortage hit, we could not accurately predict our need to purchase foodstuffs such as coconut milk. As a result we had to find alternative suppliers and paid over the odds.
Brookes concludes: Infor SCM is going to be more than software within AB World Foods. It is going to be the basis of our supply chain processes and associated systems. Those systems will in turn define our approach to a manufacturing resource planning (MRP) project we have planned. What we have seen so far has already given us a great deal of confidence.