cpg fmcg food benchmark study

8/13/2019 CPG FMCG Food Benchmark Study

1/94

Participant F1 F2

5/30/2011 5/24/2011

Questions Answers Food Food

1

Single department responsible for managing the

overall forecast function. Demand Planning 1

Finance 0

Logistics / Distribution 0

Marketing 0

Production / Manufacturing 0Sales 0

Supply Chain / Procurement 0

2

Please list the functional groups who collaborate

on final forecast. Demand Planning R,A,C R,A

Finance C A

Functional groups ACCOUNTABLE for final forecast. Logistics - I

Manufacturing I R,A

Marketing R,A I

Sales R,A R,A

Supply / Procurement C,I I

3Describe roles and responsibilities of forecastprocess participants:

Design and generation of statistical

baseline, alignment of initiatives and

to generate unconstrained demand,

collaboration with supply to validate

forecast against capacity.

Generate baseline forecast

Validation of consensus forecast vs.

budgets / LEs

n/a

Support creation of unconstrained

demand and align to supply based

constrained fcst - new initiatives,

Provide customer/ competitive

Support creation of unconstrained

demand and align to supply based

constrained fcst - new initiatives,

n/a

>>> Demand Planning

>>> Finance

>>> Marketing

>>> Sales


2/94


3/94

Participant F1 F2

5/30/2011 5/24/2011


9Time buckets used to generate base/ statistical

forecast. Weekly 1

Monthly 0

Other (describe) 0

10

How many years of history is used to generate base

/statistical forecast? Three 1

Two 0

One 0

Other (describe) 0

11 How far out do you forecast - forecast horizon? Three Years 0

Two Years 0

One Year 1Other (describe) 0

12

Do you use different time buckets when

forecasting? ( i.e. monthly for first 6 months,

quarterly for next 12 months)

13

Are special upcoming circumstances, that may

affect demand, communicated to all stakeholders

of the forecast? Yes 0

No 0

Sometimes 1

14

Which building blocks do you incorporate into the

creation of the forecast? Marketing Plans 1

Competitive Market Assumptions 1

Sales Assumptions 1

Inventory / Manufacturing

Assumptions 1

External Factors

External Factors (economy, political,

weather, consumption data, ) 0

Legal / Regulatory 0

Other (describe) 0

15

Are previous assumptions / building blocks

reviewed and their validity assessed on a monthly

basis? Yes 1

No 0

No Monthly buckets, but quarters a

years growth vs. previous years u

to sanity check the quality of the


4/94


5/94

Participant F1 F2

5/30/2011 5/24/2011


16

Are forecast assumptions communicated to all

stakeholders of forecast? Yes 1

No 0

Sometimes 0

17

Describe the process of incorporating forecast for

promotional activity:

18

19


new products:

20

Describe the process of determining the cannibalization factor / level applied to base

forecast as a result of new product launches:

As mentioned, its purely based on

assumptions Target market share,

Neilson data, drop size calculation

from trade marketing etc.

No real process, expert opinion b

on previous results

New products are finalized in initiative

meeting with the following:

i) Target volume based on target

market share, Neilson data etc.

Ii) Target consumer withcannibalization impact if any.

1. Business case is created and

presented to the leadership team

2. Once approved, Demand Plan

phase the NPL based on busines

and customer proportions3. Customer feedback (listing,

promotion, display) updates the

forecasts once we are closer to l

date

Manually reflected after alignment in

initiative meeting by highlighting

incremental volume and

cannibalization impact with a detail

drop size plan from trade marketing.

Sales feedback. Sales plans are

updated with promotional lift, th

discussed in pre-consensus meet


forecast as a result of promotions

Depends upon product to product,

based on assumption like target

market share, target group of

consumers (for example Launching

Danao 300 ml will definitely

cannibalize 180 ml but 300 ml is

mainly used by adult group while 180

ml is mainly used by Children etc.)

No real process, expert opinion b

on previous results


6/94

Participant F1 F2

5/30/2011 5/24/2011


21

Is there only one standard unit of measure to be

forecasted, across different departments? Yes 0No 1

22

What are the standard units of measure used to

develop and communicate forecasts? Units 1

dollars 1

Equivalent Units 1

Tonnage - volume 1

Other - Cases 0

23

At what level of detail is statistical base line

forecast developed? Divisional / Company Level 0

Product Line / Product Group (i.e.

Brand) Level 1

Item / SKU National Level 1Total Customer National 0

Customer / Product Group Level 0

Customer / Item / SKU Level 0

Other (describe) 0

24

At what level of detail is forecast adjusted /

overridden during your monthly cycle? Divisional / Company Level 0


Brand) Level 1

Item / SKU National Level 1

Total Customer National 0



Other (describe) 0

25

How often do you communicate forecast to senior

levels of the organization? Weekly 1

Monthly 1

Quarterly 0

Yearly 0

Sometimes 0

Never 0

26

Have the business implications of good/bad

forecasts been demonstrated to top management? Yes 1

No 0

27 Is forecast accuracy / error currently measured? Yes 1

No 0

Sometimes 0


7/94

Participant F1 F2

5/30/2011 5/24/2011


28 How is the forecast accuracy / error measured? Error / Bias 0

MAE 0

MAPE 1

WMAPE 0Other 0

29 Forecast error calculations Error: A-F 0

Actual = A, Forecast = F Error: F-A 1

% Error: A-F/A 0

% Error: A-F/F 0

% Error: F-A/A 0

% Error: F-A/F 1

30

At what level of product hierarchy is forecast

accuracy / error reported? Divisional / Company Level 0


Brand) Level 0

Item / SKU National Level 1Total Customer National 0



Other (describe) 0

31 Is a target forecast accuracy / error established? Yes 1

No 0

32

Whose performance is linked to forecast accuracy /

error? Demand Planning Team 1

Marketing Team 0

Sales Team 0

Supply / Procurement Team 0

Finance Team 0

Senior Management 0

Nobody 0

33

Who is ultimately Accountable for the Final

Forecast Accuracy / Error?

34

Is past performance used to evaluate future

forecast? Yes 1

No 0

35

Do forecasters look for ways to systematicallyimprove the forecasting process? Yes 1

No 0

Demand planner Demand planning mainly, but all

consensus team members are

accountable


8/94

Participant F1 F2

5/30/2011 5/24/2011


36

Is an integrated score-card used in your

organization? Yes 1

No 0

37

List information / data provided by sales

organization:

38

Does Sales Group provide forecast for review

during the S&OP process? Yes 0

No 1

39

Describe SALES FORECAST process (Sales

Organization):

40

What analysis do sales provide to support their

data / forecasts?

41

Who is responsible - within Sales Organization - for

the forecast / data analysis? Sales Planner or Analyst 1

Trade Marketing / Sales Strategy

Analyst 1

Marketing Analyst 0

Demand Planner collaborating with

Sales 0

Other 0

42 Is the Sales Analyst /Planner function:

Centralized - 1 analyst supporting all

customers and all regions 1

Sales performance per channel and

latest estimates figures.

Very little, gut feel mostly

Planned or un planned events,

competitor reaction, Salesperformance per region etc.

Sales forecast, listing/ listing, act

calendar

Sales Forecast is based on Baseline

Statistical projection+

Initiatives+manual adjustment due to

competitor reaction etc.

National Accounts develop an

independent forecast which is th

revised by Trade marketing and

to influence the consensus call d

pre-consensus meetings. It is also

used to compare against final

consensus


9/94

Participant F1 F2

5/30/2011 5/24/2011


Centralized - 1 analyst supporting 1

customer all regions 0

Regional analyst supporting all

customers in region 0

Other 0


10/94

Participant

Questions Answers

1


overall forecast function. Demand Planning

Finance

Logistics / Distribution

Marketing

Production / ManufacturingSales

Supply Chain / Procurement

2


on final forecast. Demand Planning

Finance

Functional groups ACCOUNTABLE for final forecast. Logistics

Manufacturing

Marketing

Sales

Supply / Procurement


>>> Demand Planning

>>> Finance

>>> Marketing

>>> Sales

F4 F5

6/3/2011 6/29/2011

Food Food

1

0

0

0

00

0

R,A -

I C

- -

I -

C,A -

C,A A

C,A I

responsible for statistical baseline,

forecast overrides, and administration

for S&OP meetings. Also responsible

for facilitating DP meetings.

not in place - sales driven 100%

Budget versus plan / observe / input

into their portion of S&OP cycle from

dp meetings

Final reconciliation of forecast vs

financial plans

provide building blocks - promo, TV,

npi,

Validate all forecasts as well as play

active role in compiling forecasts by

customer and promotional events

Generation of bottom-up, SKU

volumes


11/94

Participant

Questions Answers

4 Tools used to generate & update forecast. SAP APO

Demantra

Forecast PRO

i2

Manugistics

MS Excel

Smart Forecasts

Other (describe)

5

Which planning activities align their plans to the

forecast? Budgeting

Financial Planning

Logistics Planning

Manufacturing Planning

Marketing Planning

Sales Planning

6

Are forecasts regularly distributed to functional

groups? Yes

No

7

Sales history used for statistical forecast - outlier

handling. Automatic

Manual

Not done

8

>>> Supply / Procurement

Describe methodology used to detect / define outliers:

>>> Sales Strategy / Trade Marketing

F4 F5

6/3/2011 6/29/2011

Food Food

constraining the demand plan -

working with quotas means they may

need to produce more

1

0

0

0

1

1

0

0

0

0

1

1

0

1

1

0

0

1

0

Total sales shipment history is loaded

to the forecasting systems, and

demand planners cleanse non-

repeatble events from that history todrive to future statistical forecast

Weekly forecast variance process to

review prior week's promotional

activities.

Visual review of forecasting models

where tool has identified outliers,

n/a

APO

replacing

Manugistics

Some categories will take back new consensus number and

distribute it back to individual accounts


12/94

Participant

Questions Answers

9Time buckets used to generate base/ statistical

forecast. Weekly

Monthly

Other (describe)

10


/statistical forecast? Three

Two

One

Other (describe)

11 How far out do you forecast - forecast horizon? Three Years

Two Years

One YearOther (describe)

12




13



of the forecast? Yes

No

Sometimes

14


creation of the forecast? Marketing Plans

Competitive Market Assumptions

Sales Assumptions


Assumptions

External Factors


weather, consumption data, )

Legal / Regulatory

Other (describe)

15

Are previous assumptions / building blocksreviewed and their validity assessed on a monthly

basis? Yes

No

F4 F5

6/3/2011 6/29/2011

Food Food

1

0

0

0

1

0

0

0

0

10

1

0

0

1

0

1

0

0

0

0

1

0

com ne w excep on repor s.

No No


13/94

Participant

Questions Answers

Sometimes

F4 F5

6/3/2011 6/29/2011

Food Food

0 0


14/94


15/94

Participant

Questions Answers

21


forecasted, across different departments? Yes

No

22


develop and communicate forecasts? Units

dollars

Equivalent Units

Tonnage - volume

Other - Cases

23


forecast developed? Divisional / Company Level


Brand) Level

Item / SKU National Level

Total Customer National

Customer / Product Group Level

Customer / Item / SKU Level

Other (describe)

24


overridden during your monthly cycle? Divisional / Company Level


Brand) Level





Other (describe)

25


levels of the organization? Weekly

Monthly

Quarterly

Yearly

Sometimes

Never

26


forecasts been demonstrated to top management? Yes

No

27 Is forecast accuracy / error currently measured? Yes

No

Sometimes

F4 F5

6/3/2011 6/29/2011

Food Food

0

1

1

0

0

1

0

0

0

1

0

0

1

0

0

0

0

1

0

0

0

1

0

0

0

0

0

1

0

1

0

0

Supply Chain

and

Manufacturing

use Unit

quantities

cases

We use a top-

down

approach,

reconciling theItem/DC


16/94

Participant

Questions Answers

28 How is the forecast accuracy / error measured? Error / Bias

MAE

MAPEWMAPE

Other

29 Forecast error calculations Error: A-F

Actual = A, Forecast = F Error: F-A

% Error: A-F/A

% Error: A-F/F

% Error: F-A/A

% Error: F-A/F

30


accuracy / error reported? Divisional / Company Level


Brand) LevelItem / SKU National Level




Other (describe)

31 Is a target forecast accuracy / error established? Yes

No

32


error? Demand Planning Team

Marketing Team

Sales Team

Supply / Procurement Team

Finance Team

Senior Management

Nobody

33



34


forecast? YesNo

35

Do forecasters look for ways to systematically

improve the forecasting process? Yes

No

F4 F5

6/3/2011 6/29/2011

Food Food

0

0

01

0

0

0

0

0

0

1

0

01

0

0

1

0

1

0

1

0

0

0

0

0

0

10

1

0

Demand Planning Sales - but loosely

Item / DC

target 20% MAPE, currently running at 40-50%

Not entire

on this qu

but we wo

the pastperforman

prioritize m


17/94

Participant

Questions Answers

36


organization? Yes

No

37


organization:

38


during the S&OP process? Yes

No

39


Organization):

40


data / forecasts?

41


the forecast / data analysis? Sales Planner or Analyst


Analyst

Marketing Analyst


Sales

Other



customers and all regions

F4 F5

6/3/2011 6/29/2011

Food Food

1

0

1

0

1

0

0

0

0

0

Sales analysts (admin in reality)

at history in excel and forecast

forward based on simple moving

averages without much recourse

trend and seasonality. Very

unsophisticated.

None apart from anecdotal

Revenue vs. last year and vs. bu

volume vs. last year and budget

Estimated category volumes by

customer business teams

Customer listings and de-listings

Promotional activity

New product listings

Very minimal - this is an area where

we have tremendous opportunities

Very rudimentary - prior year volumes

are reviewed, and growth percentage

is applied, taking into account

innovation and SKU rationalizations


18/94

Participant

Questions Answers


customer all regions


customers in region

Other

F4 F5

6/3/2011 6/29/2011

Food Food

0

1

0


19/94

Participant

Questions Answers

1



Finance


Marketing



2



Finance


Manufacturing

Marketing

Sales



>>> Demand Planning

>>> Finance

>>> Marketing

>>> Sales

F7 F8

7/14/2011 7/2/2011

Food Food

0

1

0

0

00

0

- A

R I

C I

C -

C R

A R

C R

Steward of the process, owns

statistical baseline

consolidation of budget provides targets and implication

forecasts

market share estimate - new products provides marketing input volume

determine sales with a bottom-up

upproach

provides customer level promoti

volumes


20/94

Participant

Questions Answers


Demantra

Forecast PROi2

Manugistics

MS Excel

Smart Forecasts

Other (describe)

5


forecast? Budgeting

Financial Planning

Logistics Planning


Marketing Planning

Sales Planning

6


groups? Yes

No

7


handling. Automatic

Manual

Not done

8




F7 F8

7/14/2011 7/2/2011

Food Food

determine production requriement

(corporate, divisional and local level)

provides insight into implica

forecasts

0

0

00

0

1

0

0

1

1

1

1

1

1

0

1

0

0

1

Actual to budget combination of paratmeter

and cleaning historical data

outliers


21/94

Participant

Questions Answers

9Time buckets used to generate base/ statisticalforecast. Weekly

Monthly

Other (describe)

10



Two

One

Other (describe)


Two Years

One YearOther (describe)

12




13




No

Sometimes

14




Sales Assumptions


Assumptions

External Factors



Legal / Regulatory

Other (describe)

15


basis? Yes

No

F7 F8

7/14/2011 7/2/2011

Food Food

1

1

0

0

0

1

0

0

0

10

0

1

0

1

0

1

1

0

1

0

0

0

all weeklyno


22/94

Participant

Questions Answers

Sometimes

F7 F8

7/14/2011 7/2/2011

Food Food

1 0


23/94


24/94

Participant

Questions Answers

21



No

22



dollars

Equivalent Units

Tonnage - volume

Other - Cases

23




Brand) Level





Other (describe)

24




Brand) Level





Other (describe)

25



Monthly

Quarterly

Yearly

Sometimes

Never

26



No


No

Sometimes

F7 F8

7/14/2011 7/2/2011

Food Food

0

1

1

1

0

1

0

0

0

0

0

0

1

0

0

0

0

0

0

0

0

0

1

0

1

0

0

1

0

0

0

1

excel only tools - ???


25/94


26/94

Participant

Questions Answers

36


organization? Yes

No

37


organization:

38



No

39


Organization):

40


data / forecasts?

41




Analyst

Marketing Analyst


Sales

Other




F7 F8

7/14/2011 7/2/2011

Food Food

0

1

0

1

0

0

0

0

1

0

n/a

Bottom up approach, from skus per

client pers sales rep to tatal sales

figures

n/a

n/a gained / lost distribution, cu

pricing changes, promotiona

details

sales target and objectives

sales reps

national, category based

one analyst per category at all cust


27/94

Participant

Questions Answers




customers in regionOther

F7 F8

7/14/2011 7/2/2011

Food Food

0

01

sales reps

each sales rep

responsible for their

own group


28/94


29/94

Participant

Questions Answers


Demantra

Forecast PROi2

Manugistics

MS Excel

Smart Forecasts

Other (describe)

5


forecast? Budgeting

Financial Planning

Logistics Planning


Marketing Planning

Sales Planning

6


groups? Yes

No

7


handling. Automatic

Manual

Not done

8




Food

Companin

es CPG

Food

Comp

anine

s CPG

Total no. of resp no. of responses:

9 8

Food Comp CPG Food C CPG

SAP APO 3 4 33% 50%

Demantra 0 0 0% 0%

Forecast PRO 1 0 11% 0%i2 0 0 0% 0%

Manugistics 4 1 44% 13%

MS Excel 9 8 100% 100%

Smart Forecasts 0 0 0% 0%

Futurcast 0 1 0% 13%


Budgeting 7 5 78% 63%

nancial Planning 7 7 78% 88%

gistics Planning 6 5 67% 63%

cturing Planning 8 5 89% 63%

rketing Planning 5 5 56% 63%

Sales Planning 7 8 78% 100%


Yes 7 8 78% 100%

No 2 0 22% 0%


Automatic 2 4 22% 50%

Manual 6 7 67% 88%

Not done 2 0 22% 0%

Sm

M

A

N


30/94


31/94


32/94

Participant

Questions Answers

16


stakeholders of forecast? Yes

No

Sometimes

17

Describe the process of incorporating forecast forpromotional activity:

18

19


new products:

20





Food

Companin

es CPG

Food

Comp

anine

s CPG


9 8

Yes 6 6 67% 75%

No 0 1 0% 13%

Sometimes 3 1 33% 13%

Y

N

Sometim


33/94

Participant

Questions Answers

21



No

22



dollars

Equivalent Units

Tonnage - volume

Other - Cases

23




Brand) Level

Item / SKU National LevelTotal Customer National



Other (describe)

24




Brand) Level





Other (describe)

25



Monthly

Quarterly

Yearly

Sometimes

Never

26



No


No

Sometimes

Food

Companin

es CPG

Food

Comp

anine

s CPG


9 8


Yes 2 6 22% 75%

No 7 2 78% 25%


Units 6 6 67% 75%

dollars 4 5 44% 63%

Equivalent Units 1 1 11% 13%

nnage - volume 6 1 67% 13%

Other - Cases 1 1 11% 13%


Company Level 0 1 0% 13%

i.e. Brand) Level 3 3 33% 38%

U National Level 5 6 56% 75% stomer National 0 1 0% 13%

uct Group Level 1 0 11% 0%

Item / SKU Level 4 2 44% 25%

Other 1 0 11% 0%




U National Level 4 5 44% 63%

stomer National 2 0 22% 0%



Other 0 0 0% 0%Food Comp CPG Food C CPG

Weekly 3 3 33% 38%

Monthly 8 6 89% 75%

Quarterly 0 1 0% 13%

Yearly 1 0 11% 0%

Sometimes 0 0 0% 0%

Never 0 0 0% 0%


Yes 5 8 56% 100%

No 2 0 22% 0%


Yes 7 7 78% 88%

No 0 0 0% 0%

Sometimes 2 1 22% 13%

Yes

No

P

Cus

M

Qu

Som

W


34/94

Participant

Questions Answers


MAE

MAPE

WMAPE

Other



% Error: A-F/A

% Error: A-F/F

% Error: F-A/A

% Error: F-A/F

30




Brand) Level





Other (describe)


No

32



Marketing Team

Sales Team


Finance Team

Senior Management

Nobody

33



34


forecast? Yes

No

35



No

Food

Companin

es CPG

Food

Comp

anine

s CPG


9 8


Error / Bias 4 7 44% 88%

MAE 0 0 0% 0%

MAPE 5 4 56% 50%

WMAPE 1 2 11% 25%

Other 1 1 11% 13%


Error: A-F 6 8 67% 100%

Error: F-A 3 0 33% 0%

% Error: A-F/A 2 4 22% 50%

% Error: A-F/F 3 3 33% 38%

% Error: F-A/A 1 0 11% 0%

% Error: F-A/F 3 0 33% 0%




U National Level 5 6 56% 75%

stomer National 0 2 0% 25%



Other (describe) 2 0 22% 0%


Yes 8 6 89% 75%

No 1 1 11% 13%


Planning Team 7 7 78% 88%

Marketing Team 2 1 22% 13%

Sales Team 2 2 22% 25%

curement Team 0 2 0% 25%

Finance Team 1 0 11% 0%

or Management 1 1 11% 13%

Nobody 2 1 22% 13%


Yes 5 7 56% 88%

No 4 0 44% CPG

Food Comp CPG Food C #REF!

Yes 7 7 78% 88%

No 2 1 22% 13%


Err

Su

Ye

No


35/94

Participant

Questions Answers

36


organization? Yes

No

37


organization:

38



No

39


Organization):

40


data / forecasts?

41




Analyst

Marketing Analyst


Sales

Other




Food

Companin

es CPG

Food

Comp

anine

s CPG


9 8

Yes 7 6 78% 75%

No 2 1 22% 13%


Yes 4 6 44% 75%

No 5 2 56% 25%


nner or Analyst 5 3 56% 38%

Strategy Analyst 3 2 33% 25%

arketing Analyst 0 0 0% 0%

ating with Sales 2 5 22% 63%

Other 1 2 11% 25%


s and all regions 3 2 33% 25%


36/94


37/94

Participant

Questions Answers

1



Finance


Marketing

Production / Manufacturing

Sales


2



Finance


Manufacturing

Marketing

Sales



>>> Demand Planning

>>> Finance

>>> Marketing

>>> Sales


38/94

Participant

Questions Answers


Demantra

Forecast PRO

i2

Manugistics

MS Excel

Smart Forecasts

Other (describe)

5


forecast? Budgeting

Financial Planning

Logistics Planning


Marketing Planning

Sales Planning

6


groups? Yes

No

7


handling. Automatic

Manual

Not done

8





39/94


40/94

Participant

Questions Answers

Sometimes


41/94

Participant

Questions Answers

16



No

Sometimes

17


18

19


new products:

20






42/94


43/94


44/94

Participant

Questions Answers

36


organization? Yes

No

37

List information / data provided by salesorganization:

38



No

39


Organization):

40


data / forecasts?

41




Analyst

Marketing Analyst


Sales

Other




3

2

3

2

2

Sales Planner or Analyst


Analyst

Marketing Analyst

Demand Planner collaborating

with Sales

Other

Who is responsible - within Sales Organiz

data analysis?

CPG Food Compa


45/94

Participant

Questions Answers






46/94

Participant

Questions Answers

1



Finance


Marketing



2



Finance


Manufacturing

Marketing

Sales



>>> Demand Planning

>>> Finance

>>> Marketing

>>> Sales

ly process

CPG Food Companines CPG

8 78% 0%

6 78% 0%

4 33% 0%

7 44% 0%

6 78% 0%

7 100% 0%

7 78% 0%


47/94

Participant

Questions Answers


Demantra

Forecast PRO

i2

Manugistics

MS Excel

Smart Forecasts

Other (describe)

5


forecast? Budgeting

Financial Planning

Logistics Planning


Marketing Planning

Sales Planning

6


groups? Yes

No

7


handling. Automatic

Manual

Not done

8





48/94


49/94

Participant

Questions Answers

Sometimes


50/94

Participant

Questions Answers

16



No

Sometimes

17


18

19


new products:

20






51/94


52/94

Participant

Questions Answers


MAE

MAPE

WMAPE

Other



% Error: A-F/A

% Error: A-F/F

% Error: F-A/A

% Error: F-A/F

30




Brand) LevelItem / SKU National Level




Other (describe)


No

32



Marketing Team

Sales TeamSupply / Procurement Team

Finance Team

Senior Management

Nobody

33



34


forecast? Yes

No

35



No


53/94

Participant

Questions Answers

36


organization? Yes

No

37


organization:

38



No

39


Organization):

40


data / forecasts?

41




Analyst

Marketing Analyst


Sales

Other




3

2

3

2

2

2

/Planner function:

od Companines


54/94

Participant

Questions Answers






55/94


56/94

Participant C1 C2

5/31/2011 5/31/2011

Questions Answers CPG/FMCG CPG/FMCG

Point of contact between Sales and

Demand Planning - have separate

meetings with KAMs pre Demand

Planning Meetings to reconcile and

validate KAMs input into cycle;

provide NPI input (pipeline shape,

size, timeline) and Promo grid with

time / volume / customer

represents field sales - provides

into the forecast especially arou

promotions

supply constraints, out of stock

updates, product availability,

promotions build status (via 3rd party)

and Costco pallet build

DP/SCM - matrix organization

4 Tools used to generate & update forecast. SAP APO 1

Demantra 0

Forecast PRO 0

i2 0

Manugistics 0

MS Excel 1

Smart Forecasts 0

Other (describe) 0

5


forecast? Budgeting 1

Financial Planning 1

Logistics Planning 0

Manufacturing Planning 1

Marketing Planning 1

Sales Planning 1

6


groups? Yes 1

No 0

7


handling. Automatic 0

Manual 1

Not done 0

8

Knowing the business, experienc

driven - no tools deployed to spe

up the exception process



Describe methodology used to detect / define outliers: out of stock and back order fill - visual

based on knows situation - manual

adjustment to what would be a

normal demand based on past

performance; outliers - based on

validation of past 3 years of history for

any unusual activity - visual + manual

override only


57/94

Participant C1 C2

5/31/2011 5/31/2011


9

Time buckets used to generate base/ statistical

forecast. Weekly 1Monthly 1

Other (describe) 0

10


/statistical forecast? Three 1

Two 0

One 0

Other (describe) 0

11 How far out do you forecast - forecast horizon? Three Years 0

Two Years 1

One Year 0

Other (describe) 0

12




13



of the forecast? Yes 0

No 0

Sometimes 1

14


creation of the forecast? Marketing Plans 1

Competitive Market Assumptions 1

Sales Assumptions 1


Assumptions 1

External Factors


weather, consumption data, ) 1

Legal / Regulatory 1

Other (describe) 0

15



basis? Yes 1

No 0

Sometimes 0

all monthly (derived from weekly

base); financial meetings (GAP/Pre-

SOP and Exec) run in current year

months, quarters, total, next year

quarters and total only format.

all planning activity - weeks

reporting and meetings - mon

AC Nielsen, Ship to Share,

Fan Flu data, POS for top 5

customers

Private label not clearly

communicated


58/94

Participant C1 C2

5/31/2011 5/31/2011


16


stakeholders of forecast? Yes 1

No 0

Sometimes 0

17



18

19


new products:

20



New to the world >>> approx. 20%

incremental; APO configured to

display and combine dependent andindependent demands on same base

sku and project them into the future -

when cannibalization of the future

date promos needs to be applied

planned has visual in history that

shows impact of past promos on base

stock.

Typically not applied by dp - mos

seasonal; all other recommende

supplied by trade marketing basetheir analysis.



Marketing / sales driven information -

typical by sku and %

Brand manager provides expecte

impact of new product on specif

skus. Dp will then apply these %s

the base forecasts.

Bonus >>> allocation sheet by

customer (from sales) >>> validated

against known performance from

recent activity. Flyer activity >>> not

good info; Prepacks >>> best of three -

working with trade customization

(part of supply chain) planners who

have direct info from field sales - DP

owns phasing and cannibalization

factors applied to base forecasts.

Trade marketing provides regula

updates of field activities - all pro

price driven

Clearly defined and executed NPI

process - pre approval by cross

functional team required to launch

first forecast modeling followed by

go/no go decision. Once go obtained -

dp works with marketing and sales on

shape of the base and pipeline

volume that is then shared with

supply chain.

During the demand review meet

info received / reviewed on a mo

basis. Most on NPI falls into late

Quarter 1 every years


59/94

Participant C1 C2

5/31/2011 5/31/2011


21


forecasted, across different departments? Yes 1

No 0

22


develop and communicate forecasts? Units 1

dollars 1

Equivalent Units 0

Tonnage - volume 0

Other (describe) 0

23


forecast developed? Divisional / Company Level 0


Brand) Level 0





Other (describe) 0

24


overridden during your monthly cycle? Divisional / Company Level 0


Brand) Level 0





Other (describe) 0

25How often do you communicate forecast to seniorlevels of the organization? Weekly 0

Monthly 1

Quarterly 0

Yearly 0

Sometimes 0

Never 0

26


forecasts been demonstrated to top management? Yes 1

No 0

27 Is forecast accuracy / error currently measured? Yes 1No 0

Sometimes 0


60/94


61/94

Participant C1 C2

5/31/2011 5/31/2011


37


organization:

38


during the S&OP process? Yes 1

No 0

39


Organization):

40


data / forecasts?

41


the forecast / data analysis? Sales Planner or Analyst 1


Analyst 1

Marketing Analyst 0


Sales 0

Other 0



customers and all regions 1


customer all regions 1Regional analyst supporting all

customers in region 0

Other 0

n/a Based on experience, they expl

why they feel the changes / vol

should be accepted.

Customer bottom up based in

monthly meeting / info between sales

/ buyer. CPFR with WM only, not used

in DP regularly. Built in TPM and sales

strategy manager validates rollup with

KAMs and then goes to DP meeting.

Filed sales meet with buyers, ag

promo activity by account and

cascade the info to regional dir

of sales and to trade marketing

marketing communicates the p

grid to dp for forecast adjustme

Sales LE (latest estimate) by month for

curr fiscal year by account.

Promotions, Bonus, NPI, pipeline

initial and changes, list/delist/

competitive activity, abnormal

account activity

Promo timing, price point; listin

delistings

large accounts only

large accounts only


62/94


63/94

Participant

Questions Answers

1



Finance


Marketing


SalesSupply Chain / Procurement

2


on final forecast.

Demand Planning

Finance


Manufacturing

Marketing

Sales



>>> Demand Planning

>>> Finance

>>> Marketing

>>> Sales

demand planning /

supply planning matrix

organization

demand planning /

planning matrix

organization

C4 C5

6/29/2011 7/4/2011

CPG/FMCG CPG/FMCG

1

0

0

0

0

00

A A

C I

C C

C C

R I

R R

I I

development of base line forecasts

with input from other depts

Provides baseline forecast an

analytics of Sales forecast

input Provides Budget

input Provides assumptions for maactivities

helps develop base line with

additional lift / cannibalization

Provides assumption of sales

/Consolidates Sales Forecast

forecast + marketing/sales

assumptions)


64/94

Participant

Questions Answers


Demantra

Forecast PRO

i2

ManugisticsMS Excel

Smart Forecasts

Other (describe)

5


forecast? Budgeting

Financial Planning

Logistics Planning


Marketing Planning

Sales Planning

6


groups? YesNo

7


handling. Automatic

Manual

Not done

8




C4 C5

6/29/2011 7/4/2011

CPG/FMCG CPG/FMCG

helps develop base line with

additional lift / cannibalization

Provides per category forecast

factoring in secondary sales, b

forecast is the one from DP

will receive the forecast Recipient of the final frozen

forecast/reviews for supporta

and/or supply issues

0

0

0

0

01

0

0

1

1

1

1

0

1

10

0

1

0

time series analysis using seas

decomposition / smoothing of

forecast consulting with Sales

Marketing versus previous pla

we conmpare with the previous

period, check the sales coampaigns,

insert plan etc. to make sure if the

number are 'realistic' or written by

mistake


65/94


66/94

Participant

Questions Answers

16



No

Sometimes

17



18

19


new products:

20





C4 C5

6/29/2011 7/4/2011

CPG/FMCG CPG/FMCG

1

0

0

Judgemental analysis is made u

product specification as a basis

product has same features as e

one, a cannibalization factor is

historical data is used as well as the

expectation of total growth

assumption from marketing and sales

and the numbers are discussed in the

demand meeting

Historical data is used as well as the

expectation of total growth

assumption from marketing and salesand the figures are discussed in the

demand meeting

Judgemental analysis is made t

assess cannibalization by lookin

possible cannibalization becausproduct or promotional activiti

unconstrained demand figures are

collected from sales managers and the

numbers are challenged in the

demand meeting with historical data,

cannibalization effect, marketing

support, etc.

sales and trade marketing give their

initial sales assumptions based on

sales and marketing input and the

numbers are discussed in the demand

meeting

Basic benchmarking of new pro

like products + judgemental fac

a month/period where promot

used is isolated and compared

prior year or average monthly

performance without promotio

activity. Whatever is the increm

the possible lift. More observat

solidify basis of lift.


67/94

Participant

Questions Answers

21



No

22



dollars

Equivalent Units

Tonnage - volume

Other (describe)

23




Brand) Level





Other (describe)

24




Brand) Level





Other (describe)

25



Monthly

Quarterly

Yearly

Sometimes

Never

26



No


No

Sometimes

C4 C5

6/29/2011 7/4/2011

CPG/FMCG CPG/FMCG

1

0

1

0

0

0

0

0

1

0

0

0

0

0

0

1

0

0

0

0

0

1

0

0

0

0

1

0

1

0

0


68/94

Participant

Questions Answers


MAE

MAPE

WMAPE

Other



% Error: A-F/A

% Error: A-F/F

% Error: F-A/A

% Error: F-A/F

30




Brand) Level





Other (describe)


No

32



Marketing Team

Sales Team


Finance TeamSenior Management

Nobody

33



34


forecast? Yes

No

35Do forecasters look for ways to systematicallyimprove the forecasting process? Yes

No

36


organization? Yes

No

30% Mape Target - +/- 4.8% bias =

5 months into year - not meeting the

numbers

C4 C5

6/29/2011 7/4/2011

CPG/FMCG CPG/FMCG

1

0

0

0

0

1

0

0

1

0

0

0

1

0

0

0

0

0

1

0

1

0

0

0

00

0

1

0

1

0

1

0

demand manager and supply chain

director

demand planning

+/- 3% bias

80% or better MAP


69/94

Participant

Questions Answers

37


organization:

38



No

39


Organization):

40


data / forecasts?

41




Analyst

Marketing Analyst


Sales

Other







customers in region

Other

large accounts only

large accounts only

C4 C5

6/29/2011 7/4/2011

CPG/FMCG CPG/FMCG

1

0

0

0

0

1

0

1

0

0

0

sales only use historical data and their

growth assumptions in existing

products. For launches, marketing

assumptions, marketing plans,

competition etc. is evaluated and

used.

secondary sales and othe

assumptions which are s

unclear or baseless.

demand cycle starts with a pre-

demand process during which sales

managers input their assumptions

before the demand meeting. Their

feedback is collected and evaluated by

the demand manager and all the

concerns/feedbacks listed to bementioned in the demand meeting for

open discussion

if a certain SKU or catego

during demand review th

to be checked - sales will

responsible for adjusting

while demand will review

adjusted forecast.

their forecast of sales, promotional

targets, insert and campaign plans are

communicated. Trade marketing

collects and reviews and where

necessary revises data

Sales organization factor

secondary sales data from

and marketing / sales pla

baseline forecast.

there is a local sales analyst and dema

country forecast. Regional demand pla

supports local dp for all markets hand


70/94


71/94

Participant

Questions Answers

1



Finance


Marketing


SalesSupply Chain / Procurement

2


on final forecast.

Demand Planning

Finance


Manufacturing

Marketing

Sales


3

Describe roles and responsibilities of forecast

process participants:

>>> Demand Planning

>>> Finance

>>> Marketing

>>> Sales

demand planning /

supply planning matrix

organization

demand planning / s

planning matrix

organization

C7 C8

6/29/2011 6/2/2011

steel products, i.e.. Fasteners to

Home Depot. Clothing

0

0

0

0

0

01

A R

- -

- -

- C

- -

- A

A -

develop base l ine forecasts Responsible for maintaining in

of demand plan (forecast) and

Master Production schedule (M

along with all corresponding s

Futurcast / GEAC ). This team

purchase orders ( work orders

Financial plan is based on deta

level demand plan.

none Responsible for portfolio

management with emphasis o

styles as well as discontinuatio

process.

adjust for market condit ions Provide all initial new style for

as well as play active role in co

forecasts by customer, promo

events & clearance sales.


72/94

Participant

Questions Answers


Demantra

Forecast PRO

i2

ManugisticsMS Excel

Smart Forecasts

Other (describe)

5


forecast? Budgeting

Financial Planning

Logistics Planning


Marketing Planning

Sales Planning

6


groups? Yes

No

7


handling. Automatic

Manual

Not done

8




C7 C8

6/29/2011 6/2/2011



Responsible for outsourcing

worldwide manufacturing fa

customer requirements as d

the demand plan and the su

purchase orders generated

Demand & Operations Plann

0

0

0

0

01

0

0

0

0

1

0

1

1

1

0

0

1

0

Demand history is updated

monthly basis (automated )

validated by the Demand &

Operations Planning Team.

are detected and smoothed

automated portion of the st

forecast as well as by analys

forecast accuracy analysis an

interaction with the Sales te

data) to ensure that it is ind

nave process, very qualitative

excel used to build the forecast which is

uploaded into APO


73/94

Participant

Questions Answers

9


forecast. WeeklyMonthly

Other (describe)

10



Two

One

Other (describe)


Two Years

One Year

Other (describe)

12




13




No

Sometimes

14




Sales Assumptions


Assumptions

External Factors



Legal / Regulatory

Other (describe)

15


basis? Yes

No

Sometimes



customers

Private label not clearlycommunicated

C7 C8

6/29/2011 6/2/2011



01

0

1

0

0

0

0

1

0

0

0

0

0

1

1

0

0

0

0

0

0

1

No - entire Financial Plannin

Demand management proce

based on monthly forecasts.

data is volatile.

anoma y an no a ren .

-


74/94


75/94

Participant

Questions Answers

21



No

22



dollars

Equivalent Units

Tonnage - volume

Other (describe)

23




Brand) Level





Other (describe)

24




Brand) Level





Other (describe)

25



Monthly

Quarterly

Yearly

Sometimes

Never

26



No

27 Is forecast accuracy / error currently measured? YesNo

Sometimes

C7 C8

6/29/2011 6/2/2011



1

0

0

0

0

1

0

0

1

0

0

0

0

0

0

1

0

0

0

0

0

1

0

0

0

0

0

1

0

00

1


76/94

Participant

Questions Answers


MAE

MAPE

WMAPE

Other



% Error: A-F/A

% Error: A-F/F

% Error: F-A/A

% Error: F-A/F

30




Brand) Level



Customer / Product Group LevelCustomer / Item / SKU Level

Other (describe)


No

32



Marketing Team

Sales Team


Finance Team

Senior ManagementNobody

33



34


forecast? Yes

No

35



No

36


organization? Yes

No



numbers

C7 C8

6/29/2011 6/2/2011



1

0

0

0

0

1

0

0

0

0

0

1

0

0

0

00

0

0

1

0

0

0

0

0

01

0

0

0

1

0

1

- (Demand & Operations Pla

Team) & Sales Team

Bias +/- 5%

MAPE 30%


77/94


78/94

Participant

Questions Answers

C7

6/29/2011 6/2


Home Depot. Clo


79/94

Participant

Questions Answers

1



Finance


Marketing


Sales


2


on final forecast.

Demand Planning

Finance


Manufacturing

Marketing

Sales


3



>>> Demand Planning

>>> Finance

>>> Marketing

>>> Sales

demand planning

supply planning m

organization

demand plan

planning mat

organization

88%

0% 0%13%

Single department responsible for m

forecast function

175%

25%

0%13%

Functional groups ACCOUNTABL

3 have shared ownnership, 1 sales and

only - all other demand planning


80/94

Participant

Questions Answers


Demantra

Forecast PRO

i2

Manugistics

MS Excel

Smart Forecasts

Other (describe)

5


forecast? Budgeting

Financial Planning

Logistics Planning


Marketing Planning

Sales Planning

6Are forecasts regularly distributed to functionalgroups? Yes

No

7


handling. Automatic

Manual

Not done

8




3 have shared ownnership, 1 sales and 1


50%

0% 0% 0%13%

Tools used to generate & update

63%

88%

63% 63%

Budgeting Financial

Planning

Logistics

Planning

Manufacturin

Planning

Which planning activities align their plan

50%

88%

Automatic Manual

Sales history used for statistical forecast

88%

Time buckets used to generate base/ sta


81/94

Participant

Questions Answers

9



Other (describe)

10



Two

One

Other (describe)


Two Years

One Year

Other (describe)

12




13




No

Sometimes

14




Sales Assumptions


Assumptions

External Factors



Legal / Regulatory

Other (describe)

15



basis? Yes

No

Sometimes



customers

Private label not clearlycommunicated

3 have shared ownnership, 1 sales and 1 su


25%

Weekly Monthly

50%

38%

0%

Three Two One

How many years of history is used to ge

/statistical forecast?

38%

0%

Yes No

Are special upcoming circumstances, th

demand, communicated to all stakeholders

75%63%

100%

63%50%

Which building blocks do you incorporate

of the forecast?


82/94

Participant

Questions Answers

16



No

Sometimes

17



18

19


new products:

20





3 have shared ownnership, 1 sales and 1


75%

13%

Yes No

Are forecast assumptions communicated

of forecast?


83/94


84/94

Participant

Questions Answers


MAE

MAPE

WMAPE

Other



% Error: A-F/A

% Error: A-F/F

% Error: F-A/A

% Error: F-A/F

30




Brand) Level





Other (describe)


No

32



Marketing Team

Sales Team


Finance TeamSenior Management

Nobody

33



34


forecast? Yes

No

35



No

36


organization? Yes

No



numbers

3 have shared ownnership, 1 sales and


0%

Error / Bias MAE MAPE

50%

63%

75%

25%

At what level of product hierarchy is fore

reported?

88%

13%25% 25%

Whose performance is linked to foreca


85/94


86/94

Participant

Questions Answers

3 have shared ownner

only - all other deman

customers and all

regions

customer all r


87/94

Participant

Questions Answers

1



Finance


Marketing


Sales


2


on final forecast.

Demand Planning

Finance


Manufacturing

Marketing

Sales


3



>>> Demand Planning

>>> Finance

>>> Marketing

>>> Sales

demand planning

supply planning m

organization

demand pla

planning ma

organization


88/94


89/94

Participant

Questions Answers

9



Other (describe)

10

How many years of histo

cpg fmcg food benchmark study

Documents