Business Objective
Our client is a global CPG major. The client wanted to create omnichannel forecasts essential to meet the ever-changing demands online (Delivery and Pick Up in-store). The key step of the journey is to understand the root cause of common inventory-related issues in store and enable decision-making by identifying gaps.
The main objective was to-
- Perform robust forecasting & safety stock measurement to optimize the minimum stock levels
- Identify phantom issues & minimize loss
- Overlay service-level issues to identify the additional root causes of OOS
Challenges
- Sparseness of data for low selling UPCs X Stores makes it hard to estimate the future sales
- Adjusting for Impact of Covid in the training period data by using external data like Mobility Index
- Scale of Training & data processing was extremely high (300K+ time series) which required creative ways to optimize & execute the experiments
Solution MethodologyÂ
- Conducted design sessions to help identify opportunities for tangible action based on insights
- Collating and integrating data from multiple sources – POS, Inventory, Pricing, Promo, Seasonality
- Exploring the data quality and understanding multiple factors (promotions, activations) that impact sales
- Advanced analytics-based modeling approaches at varying granularity to forecast sales considering the complexity of cohorts.
- Developed tools to drive activation by leveraging key KPIs like Inventory, OOS, lost $, safety Stock, Phantom
Business Impact
- Total estimated ~$20 Mn lost $ historically, which can be avoided in future with necessary actions at Store Level over next 2 years for a given retailer
- 1.5% revenue uplift
- Proactive inventory planning specially during seasonal periods.
