A global confectionery manufacturer achieved an 85% elimination of stock-outs and a 30% increase in productivity by enabling Bizom ARS
Every day at the break of dawn, trucks filled with FMCG goods head out from warehouses, distributing products all over the country. And every day, we all survive on those products that have been distributed to shops near us. That’s how vital on-time distribution is to the world of consumers. Even before the first tea is made, the biscuit reaches the smallest Kirana stores in India to complement the consumer’s tea.
Every day, each of us consumes at least 20-50 different FMCG products.
But what happens when this flow of distributing goods loses efficiency?
The lives of millions of consumers get impacted.
Luckily, by putting in place a system that monitors and updates distributors’ inventories, FMCG companies can find an easy fix to end this worry. Here are five more reasons why an intelligent ARS system helps build a stringent supply chain.
Omit Delay in Fulfilling Stocks Ordered by Retailers
A delay in delivering stocks to retail outlets can lead to many unsatisfied consumers, who would be highly motivated to switch brands simply due to lack of availability. Implementing an intelligent ARS solution ensures optimised and reduced lead time for filling up retail shelves.
Unavailability of Stock due to Sudden Sales
Often distributors face stock-outs due to a sudden increase in sales. Which if not monitored, leads to a lack of stocks at retail shelves and curtailed demand in the market. But with ARS, things become more manageable. Distributors need not worry about re-ordering supplies as the system auto-updates the stock while simultaneously maintaining the safety stock.
What’s more, when inventories are tracked and updated on time, flaws in human operations are reduced, as distributors no longer have to remember to order the company’s stocks. Given how distributors operate with multiple brands, placing repeated orders becomes a hassle for them to maintain.
Improved Fill-Rates lead to Higher ROI for Distributors
When a distributor fulfils the retailers’ requirements, they are actually addressing the end-user’s need, which is the origin of these retailer orders. Any FMCG company with low fill rates experiences customer demand being fulfilled by other brands, helping them gain market share at the company’s expense. An ARS helps align distributor inventory very closely with these market requirements.
Bizom’s Auto- Replenishment System (ARS) is one such solution that makes this a reality for FMCG brands today. In addition, the inventory costs are lower for the distributors as there is no overstocking but only inventory optimization.
Better Management of Inventory and Distributor’s Investment
A leading global confectionery company is using Bizom’s ARS solution to increase their fulfilment rate. The company faced a major problem as distributors dumped stock at the month’s end to meet their target. This meant that the distributor’s investment was getting stuck by the end of the month, and they could not invest further at the start of the next month. This often led to stockouts for the company’s products as the distributor was not willing to invest more.
But after incorporating Bizom’s ARS into the supply chain, the company was not just able to curb these problems and improve their fulfilment rate stupendously. They were also able to incubate the mechanism of right stocking as stock dumping was reduced, which meant no distributor stocked expired products. Also, this allowed the company to bring the distributor’s focus on its entire range of products, rather than on just selected products.
Forecast production requirements more accurately
Another key outcome that this confectionery brand experienced by implementing Bizom’s ARS was efficacy in forecasting production units more precisely. As confectioneries have a shorter shelf life, this proved to be highly beneficial to the company to ensure optimum production and distribution of stocks, which helped build a stronger supply chain.
Thus, to conclude, by integrating the Auto-Replenishment System, FMCG brands can stay ahead of their competitors in terms of lead time to reach the market, can improve their primary, secondary and tertiary sales by ensuring timely delivery of products to distributors, and can increase the efficiency of their supply chain by making it faster and more synchronized.