ALIDI success story: forecasting commodity flows is the key ability in the distribution business
About ALIDI
ALIDI, one of the largest FMCG distributors in the CIS, and Novo BI, Russian developer of Novo Forecast Enterprise sales forecasting system, told about the results of the forecasting system implementation and almost 2 years of use.
ALIDI is distributor #1 and one of the largest suppliers of goods of known international producers to retail chains: Procter & Gamble, Nestle, Nestle Purina, MARS, and Wrigley. ALIDI today:
- 32 branches, 29 warehouses in Russia, Belarus, Kazakhstan
- 6,600 qualified employees, including 1,200 sales representatives
- Annual turnover 41 billion rubles as of 2017 134,000 m2 of warehouses
- More than 100,000 outlets
- ALIDI is regularly featured in industry rankings. The company’s results are highly esteemed by the business community. ALIDI is listed among TOP-5 Logistic Services Providers in Russia (EALA) and TOP-200 largest Russian private companies (Forbes).
The company has been producing tasty and healthy cereal products that are easy in preparation for every day and provide families with good and healthy eating for more than 25 years.
Implementation effects
"Forecasting commodity flows is the key ability in the distribution business, affecting all the financial indicators of a company and its relationship with suppliers," says ALIDI Deputy Director of Logistics.
"Before we started cooperating with Novo BI in March 2016, we used our own sales forecasting methods, but their accuracy was less than 50%. We needed to find a high-quality product with a rich mathematical apparatus. We got acquainted with Novo BI Company and its product for forecasting in Excel – Novo Forecast PRO. After six months of operating the product, the accuracy of forecasts obviously increased, but the company needed a company-wide tool that would allow involving employees of various departments (logistics specialists, merchants, marketers, purchasers) in this process," Dmitry Frizen recalls.
"This moment was a turning point in our cooperation with ALIDI. We started creating a company-wide forecasting system with full automation of forecast business processes and a multi-user environment for joint planning of factors affecting forecast accuracy. Since March 2017, ALIDI has been using this particular system for calculating forecasts and planning factors," – says Alexey Baturin, Novo BI CEO.
Dmitry Frizen continues, "As the system functionality was developing and employees from different countries were getting connected to the system, the accuracy of forecasts was increasing with each new cycle of forecasting. In September 2017, the planned scale of the system was fully achieved. Several dozen employees already work in the forecasting center."
"Speaking about the overall economic effect, it is at least hundreds of millions of rubles a year, given the scale of ALIDI's activity. The increased forecast accuracy allowed us to build more fruitful relationships with suppliers, raise customer satisfaction, as well as plan and build company internal processes more effectively."
Results
- More than 200 employees from different countries plan and forecast in the system on a daily basis;
- Forecasting cycle is fully automated;
- Forecasting accuracy has been increased by 33% (from 45 to 78%);
- The rate of forecast calculation has increased tenfold;
- The speed of decision-making has increased more than 2 times;
- The surplus stock has decreased by 50%;
- Out-of-stock situations have reduced by 10%.
