Fox’s Biscuits responds to daily retailer forecasting

Fox's Biscuits now uses FuturMaster for its planning and processing requirements. Pic: Fox's.

Fox’s Biscuits has faced the challenge of daily retailer forecasting by installing FuturMaster software, which measures the Mean Absolute Percent Error (MAPE) of its orders.

The UK firm, which has over 350 branded and own-label products and promotional and seasonal lines, says it has improved customer service levels, resulting in the number of products experiencing service issues falling by 65%.

Trend analysis

It claims it has reduced the shelf life of its stock, which is distributed through export channels (to Europe, North America and the Far East), independent distributors and UK retailers from 40 weeks to two to three weeks.

Bill Dales, demand planning controller, Fox’s, told BakeryandSnacks, prior to FuturMaster, the planning process took the best part of a month to complete due to the multiple iterations and assumptions within the spreadsheets.

He said most retailers now share forecasts on a daily basis. A team of eight people at Fox’s use FuturMaster as a process tool and for trend analysis. They can then fine-tune weekly booking forecasts, using retailers’ Epos data to go back two to three years to work out what sells and at what price.

FuturMaster’s production and inventory management tool deals with 3,500 live forecasts a week and can create a new plan to respond to that information in 90 minutes.

Fox’s, which became part of 2 Sisters Food Group in 2011, makes around 1,450 billion biscuits from three UK manufacturing bakeries in Batley, Kirkham and Uttoxeter.

Batley has eight ovens and up to 26 lines operating, using 9,300 tons of flour and 6,000 tons of chocolate to produce 25,000 tons of biscuits every year. Average weekly production at Uttoxeter is 1,000 tons or 50,000 tons per annum.

Kirkham is the home of the Rocky biscuit range, producing 1,700 chocolate biscuit bars per minute, equating to over 10 million per week. Kirkham also produces 10 million party rings each week.

Before, around a fifth of products had service level issues. Now it’s down to 5% a month,” said Dales.

It’s crucial for us to produce exactly the right volumes and get sell-through with retailers. The demand planning software predicts what’s needed in terms of sales units to shift for the coming days, months or year. This helps us plan ahead and make sure we can deliver on what’s promised.”

Rocky, Classic, tinned assortments

The software manages up to 150 deliveries a week for retailers, including Tesco, M&S and Aldi, while customer service levels have increased from 96% to 99% on over 30 million cases sold each year, according to Dales.

Popular brands include Rocky, Classic and tinned assortments, which account for around a fifth of sales. The company employs more than 2,000 people; bringing on extra staff from June to November to prepare for peak production during the run up to Christmas.

The Christmas assortment tins and packets have up to 20 different biscuits inside, each of which needs to be produced and ready for assembly at exactly the right time. This can mean biscuits baked at different sites and others made on the same production lines as finished products.

It might also need to split production between different machines and run for an extra eight hours before cleaning and switching to other ingredients.

Planning promotions with retailers has also become an important part of the day-to-day business. FuturMaster’s software evaluates the impact of running a two-for-one offer by determining what would be the resulting sales uplift and the extra volumes that need producing.

"It also shows when it would be a good time to do these promotions based on analyzing production line requirements and demand,” added Dales.

Dr Bo Zhou, founder and CEO of FuturMaster, said the company has designed and optimized hundreds of demand forecasts and supply management processes for customers, including PepsiCo, Heineken and Saint-Gobain, to improve Supply Chain Planning (SCP) efficacy.

Zhou claims Chinese enterprises will invest heavily to improve supply chain efficacy in the next few years.

Consumers’ primary concern is to purchase the right products in the right location at the right time. To win over customers, companies have to improve service level. With an unsatisfactory service level, businesses will suffer losses in revenue and market share,” he said.

“In the stagnant economy today, any company hoping to achieve profit growth needs to make the supply chain capability improvement its top priority. Companies need to target specific market segments with differentiated products; they need to reach wider customer base by extending the delivery network from tier 1, tier 2 and tier 3 cities to tier 4, tier 5 towns and even the countryside. These changes will introduce vast supply chain complexity, and raise the requirement for SCP efficacy to a new level.”

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