Vendor management for CPG/FMCG products manufacturer

Client

A leading multinational CPG/FMCG products manufacturer.

Opportunity

The client wanted to get a 360-degree view of how their vendors were performing to identify weak links and opportunities for vendor management improvements. Since the client was currently working with disconnected, separate reports from different avenues, it was of strategic importance to increase the transparency across their entire supply chain to plan logistics and stock keeping accordingly.

Solution

SG Analytics proposed a Business Intelligence Vendor Management Solution with a real-time dashboard to get a holistic understanding of the separate components of the supply chain that would enable better monitoring of vendor lead times, schedules, and fulfillment rates.

SG Analytics' team helped consolidate data from different sources to feed into the BI dashboard with real-time visualizations to allow the client draw meaningful insights such as:
  • Which vendors are routinely late on the shipping orders?
  • What are the average purchase price and time variability for each vendor?
  • Which vendors are over-performing/under-performing? For what time duration?

The dashboard also displayed a score for each vendor based on past performances to help eliminate bad performers from future plans. All of these factors helped to make strategic decisions onto which vendors to incentivize and which to eliminate from the supply chain. Hence, the solution led to reduced lead times, improved coordination between production and distributors, minimized on-hand inventory, and reduced working capital.

Our team also deployed predictive analytics tools on the dashboard for the following scenarios:
  • Help visualize the impacts of different “what-if” scenarios onto the projected cost saving and profit.
  • Optimize various supply schedules from different vendors to achieve the desired levels of volume.
  • Help track and analyze supplies to determine how actual performances line up with predicted performances.

This exercise ultimately helped in the overall market competitiveness for the client.

TOOLS USED

Tableau
R
SQL

Value Delivered

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1
SG Analytics' solution enabled the client to eliminate excess production and warehouse charges.
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2
The client was also able to reduce early/late deliveries by better coordination with vendors and eliminate stockout costs.
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3
Overall, the client was able to reduce inventory while increasing customer satisfaction and experienced a 15% increase in profitability.
 

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