INVENTORY PLANNING AND REPLENISHMENT -DAIRY PRODUCTOS, JUICES, COLD CUTS, AMONG OTHERS.
A Mexican food company with over 70 years of history. Initially focused on the production and distribution of milk—where it has long held a leading sales position in Mexico—it later expanded into other food segments such as cheese, yogurt, juices, meats, desserts, etc.
Today, the company operates in several countries, with 28 plants and more than 165 distribution centers.
Challenges
Solutions
Products
desafios
Challenges
To improve planning with the following objectives:
1. Reduce inventory (in some cases, slow-moving products were expiring and causing losses)
2. Increase service level (in some cases, there was insufficient product available at certain locations, leading to lost sales).
In Mexico, the company had made significant investments in SAP-APO advanced planning systems but had not achieved the expected improvements in final operations.
SOLEC conducted a diagnosis and concluded that while the systems were good and well-implemented, the issue lay in the quality of the master data being used.
Solutions
SOLEC implemented, following APICS best practices, a historical analysis method to assess the accuracy of the demand plan and define key planning parameters required by the systems:
1. Replenishment method.
2. Safety stock.
3. Minimum and maximum inventory levels.
4. Replenishment frequency
5. Replenishment lot size.
6. Planning horizon to cover.
7. Etc.
The procedure included a final verification of the expected service level and the associated inventory investment.
The parameters derived from the process were loaded into SAP-APO in the production environment and the system went live. The implementation was followed closely and fine-tuned over several weeks.
Six months after go-live, the official performance measurement was conducted, resulting in:
1. 10% reduction in inventory levels
2. 4% increase in service level (notably, the previous service level was already strong at around 90%)
Products
Inventory Planning Process Improvement
