Thresher Group, the UK specialty drinks retailer, has improved stock management since transitioning its distribution methodology and implementing forecasting and replenishment software. Operating under two distinct business units of 11,400 wine-led shops and 800 drinks retailing stores, Thresher has combined the power of JDA Portfolio Merchandise Management System-I (MMS) and Advanced Warehouse Replenishment by E3 solution to better manage the inventory that flows from its seven warehouse locations to nearly 2,000 nationwide stores.
Simon Thomas, Thresher’s IT and business change director, comments: “AWR gives us more control over our business and enables us to manage the movement of goods throughout the supply chain more effectively. Since implementing JDA we have achieved a wide range of important benefits including keeping suppliers up-to-date on inventory movement and advising them on under- or over-stocking in certain warehouses.
The company wanted to eliminate the problems often associated with a “pull” method of distribution, where all of Thresher’s UK stores including Threshers, Wine Rack, Victoria Wine, Bottoms Up, Huttons and Drinks Cabin, as well as Haddows in Scotland, ordered from a product catalogue on a weekly basis.
States Thomas: “With our old system, we could specify the right stock for a promotion, a special event or a regular sale. However, store managers tended to pull more stock than they needed causing immediate distribution stock problems throughout the organisation.”
Knowing that things had to change, Thresher moved to a “push” distribution model based around a central stock control system. “It’s more efficient to move one lever to make something happen than rely on lots of distributed and independent levers. Thresher wanted to move to a more scientific approach based on planning ranges, and only delivering stock as and when required,” continues Thomas. “We wanted more control of stock, but at the same we didn’t want store managers worrying about empty shelves or over-full reserve stock. JDA’s automated replenishment system was the obvious answer.”
In describing the newly installed system, Thomas says that all the stock, supplier and demand information is fed from MMS, which Thresher relies on to keep track of its inventory, into AWR which in turn analyses and interprets the data to make forecasts. AWR then calculates the projected ordering requirements for each store and makes certain that enough stock is available in the warehouse to meet their inventory needs.
According to Thomas, this intelligent analysis is enabling the retailer to more accurately align product to store specific consumer preferences.
“After using sales data to make more accurate forecasts, we’ve started to range stores differently, so that they are more in line with consumer demand at these stores,” remarks Thomas. “This means that many stores in Scotland, for instance, which tend to sell 50% more vodka, can be grouped and allocated ranges to their needs. Needless to say, product ranges have to be different for stores in a leafy suburb from those in an inner city housing estate and we need to take account for seasonal fluctuations such as sales of Champagne sometimes doubling before Christmas. AWR enables us to do this.”
Thomas also says that AWR helping the organisation manage its promotions more effectively. “Promotions are a very important part of our business,” says Thomas. “AWR helps us more accurately consider how much extra stock is required to maximize sales of certain brands on offer.”
- Thomas lists several other benefits resulting from implementing AWR including:
- Improved product availability.
- Reduced stock in warehouses, leading to significant space savings.
- Reduced reserve stock in stores.
- Reduced investment in slow and non selling lines.
- More accurate balancing of stock across warehouse network
Thomas comments: “We wanted a cost-effective solution which would be easy to implement and already configured to the needs of our business. AWR has gone in very well, with minimal fuss and no modifications were required. The project was on time, and on budget.”