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Winning supply chain strategies for the wine, spirits and beverages industry
Contents
Market situation and trends
Accurately forecasting demand Getting the marketing right Maintaining good supplier relationships Streamlining warehousing operations Regulations, reporting and traceability Fulfil orders efficiently Empowering your staff and your customers 4 4 5 5 5 6 7 7 9 10 10 11 11 12 12 13 13 12 15
Choosing the right technology Tailored for the wine, spirits and beverages industry
CRM and sales order management Distribution and warehousing Supplier relationship and procurement management Planning and forecasting Manufacturing and assembly Financial management Business intelligence Integration and collaboration
Introduction
Todays wine, spirits and beverages industry faces ever-shifting demand for its products, strict regulation and increasing price competition. World-class companies in this mature industry are succeeding by scaling up production, streamlining their supply chains, expanding into new geographic areas, implementing more efficient processes, cleverly marketing products, and focusing on ever closer relationships with suppliers, partners and customers. This brief examines the issues faced by the people who wholesale and distribute beer, wine, spirits, soft drinks and other beverages. It examines the current state of the industry and explores the future issues that confront it. The brief also spells out some of the technological requirements that are specific to the wine, spirits and beverages industry. Finally, this brief will match those needs with the software products that IBS provides directly to many leading companies in this market segment. Key features of the software will show how IBS can make beverages distribution operations more efficient and competitive.
Market situation: Large and mature market Differentiation key to a competitive advantage Consolidation strong Large supermarket chains and buying groups have more power Pressure on thin margins Technology allows companies to stay ahead of competitors.
Forecasting demand: Predicting demand important for distribution Forecasts must reect customer demand Access to right information and analytical tools important.
Supplier relationships: Distributors work with suppliers the world over Flexible procurement leads to shortened lead times and cost savings VMI can cut costs but requires close systems integration SCM software must handle rebates and sales incentives.
Streamlined warehousing: Some wines and spirits require over 10 years of storage High-tech warehousing to manual picking depending on market Multiple distribution centres require integrated IT systems Efcient returns processing can save costs.
When your production center and your global, regional and local warehouses all hold supplies, the ability to exibly ll orders from various sources is a precious commodity. Many of the larger companies in the industry maintain multiple distribution centers. Customers can have their orders lled from more than one source, some of which are different legal entities within the group. Avoiding administrative chaos under these circumstances requires careful cross-invoicing and transaction processing through tightly integrated information systems. Managing returns Returns coming back need to be handled just as efciently as orders going out. There are barrels and kegs to be recycled, dispensers to be relled, taps to be sent for repair, consignment stock to be put away, missed deliveries to be corrected, cash to be reconciled and display stands to be remodelled for the next marketing campaign. And there are spoiled products being returned too. Its estimated that loss of sales from corked wine alone costs the industry an estimated EUR 350 million a year in Europe. Spoiled returns need to be credited to the retailer, claimed back from the supplier and disposed of. Handling these returns and processing them properly so that they are cleaned and re-used, or disposed of correctly, can be a complex logistics operation on its own with both great potential for costs and cost savings. Handling returns inefciently can wipe out prots made in other parts of the business.
IBS solution for the wine, spirits and beverages industry Solution: IBS ENTERPRISE Modules for: CRM and sales order management Distribution and warehousing Dangerous goods handling SRM and procurement Planning and forecasting Manufacturing and assembly Financial management Business intelligence Integration.
Compliance is key
That doesnt mean beverages distributors and wholesalers are not open to new ideas, just that they evaluate each new idea carefully, and already have in-house policies which can impose rigid demands on software vendors. Software vendors need to be able to show that their software already complies with regulatory demands on bonded storage, batch traceability and dangerous goods handling, that it already has extensive features to handle critical business issues such as spoiled wine returns and sales commissions, and that it can handle future needs like pick-to-light technology in the warehouse. If you are in the beverages distribution business, you face some difcult choices when it comes to choosing software to support your business processes.
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Advanced warehousing technique support Utilize modern warehousing techniques that speed up order fullment and minimize error, including automated receiving, cross-docking, pick-to-light, automated picking, automated weighing, pallet generation and weighing, and exible picking rules. Direct supplier interfaces Let your suppliers manage their own product inventories through Supplier Managed Inventory (SMI) and Vendor Managed Inventory (VMI) agreements. Provide suppliers with direct access to your business through EDI, XML, email or the web. Route planning Cut transportation cost and increase customer satisfaction by optimizing delivery routes and schedules, printing route plans, shipment manifests, delivery advice, freight documents and loading advice. Our solution includes support for non-eet shipping management. Reverse logistics and returns handling Efciently manage the collection and handling of returned products, including those that need to be recalled because of regulatory decisions. Reduce the costs of handling, storage, and disposal of returns, and the overheads involved in crediting customers and reclaiming costs from producers.
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Financial management
In addition to all of the nancial functionality that you would expect from an integrated solution, IBS software includes an array of tools that provide top care for beverage distributors nancial operations, including: Automatic excise duty calculation Our beverages solution calculates domestic excise duties applicable at the given date, prepares invoices base don the calculations, and integrates them into the accounting system. It also calculates the tax to be presented to government, including the nancial map that supports the calculations. Order line pricing The IBS solution handles exible pricing issues, including contract pricing, multiple price lists, sales promotions, annual rebates and discounting. Automatic order line pricing results in faster invoicing, improved accuracy and reduced days outstanding. Tax accounting The IBS solution fully supports the handling of tax requirements in most countries, including value added tax (VAT), general sales tax (GST) and Use Tax. Taxable amounts and taxes levied are calculated automatically and carried over to invoices and accounting routines. Centralised nancial operations IBS nancial routines handle G/L company consolidation, with exible options for consolidating information in multi-level company structures operating with different system currencies and chart of accounts into a corporate format.
Business intelligence
IBS software offers a business processes assessment solution that lets you extract, measure and compare information from a data warehouse that reects all information contained within your business system. IBS BUSINESS INTELLIGENCE software helps you maximize prots and control critical success factors, including: periodical improvements in KPIs and subsequent ROI; ll rates and on-time deliveries; business partner performances based on item and customer protability; operational costs and productivity; optimized supply chains and collaboration; automated business processes; and automated decision support and event management. Pre-loaded client applications with OLAP (On-Line Analytical Processing) tools for data marts are included, and the IBS solution uses SCOR (Supply Chain Operations Reference-model) to help measure business performance.
IBS software has helped Aveleda to reduce our overhead costs, to plan and control investments as well as profitability.
Jose Ferreira,
Information and Management Control Director, Aveleda
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IBS has the right software for you and the experience of worldwide installations. Want to nd out more? Contact IBS today: info@ibsus.com or visit www.ibsus.com
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IBS worldwide
IBS, International Business Systems, is a leading provider of specialised business solutions that optimise and increase the efciency of the entire supply chain. IBS solutions include effective routines for sales support, customer relations, order handling, procurement and supply chain management, demand-driven manufacturing and distribution, nancial control and exible business performance measurement. Regardless of platform, our solutions let you collaborate with your business partners and integrate both your processes and systems. IBS has some 5,000 customers in more than 40 countries, including ABB, Ciba Vision, Galexis, Nautors Swan, Nintendo, General Electric, Honda, Maxell, Scribona, Miele and Volvo.
IBS, IBS ENTERPRISE and IBS INTEGRATOR are registered trademarks of IBS AB, in the European Union and in other countries. All other trademarks or registered trademarks mentioned herein are the property of their respective holders. The information contained in this document is summary in nature, subject to change and intended for general information only. The details pertaining to functionality and routines are based on IBS software, post release 6.0. For updates of this information, please contact your local IBS representative. Production and design: Global Sales and Marketing department. IBS 2006.