Case Altia

Demand forecasting and purchasing planning

Introduction

Altia, a multinational manufacturer and distributor of alcohol products, has introduced RELEX’s solution for its demand forecasting and purchase planning. The group’s goal of unifying its demand planning and purchasing practices, as well as providing visibility right across its international operations so that its global data could be used for forecasting, were realised within a year of moving onto the RELEX system.

Altia is a producer, promoter, importer, exporter and distributor of alcoholic drinks; both of their own labels and international brands. With net sales of around €500M p.a. and some 1100 staff it’s the leading company in its sector in the Nordic and Baltic region.

Altia at a glance

Founded in 1999
Net sales €500M per year
Employees 1100
Production facilities in 4 locations, Koskenkorva (distillery), Svendborg, Rajamäki and Tabasalu (wines and strong alcoholic production and bottling)
5 Logistics Centers in Svendborg, Rajamäki, Tabasalu, Årsta and Riga
Altia introduced RELEX in Finland and Sweden in December 2012 and extended its use to Estonia, Denmark and Latvia in 2014

Challenges and goals

Altia operates in multiple territories and its biggest challenge has been the international nature of its business; in order to become more efficient it needed to integrate and unify its workflows and improve its forecast accuracy across its global operations.

A key goal was to split the team handling procurement planning and forecasting for retail outlets into two separate groups, as each operation requires a different approach and different skills. However, despite the organisational changes, the processes were to be kept together, as far as possible, on one system and through the use of the same tools. Previously Altia had used SAP’s MRP and E3 AWR for its demand forecasting and procurement planning. These were replaced by RELEX.

The project

The implementation of RELEX was done to a tight timeframe. The first rollout was done only three months after the project had begun. All Altia’s requirements in terms of functionality were put into place according to plan, despite the broad scope of the project and the demanding schedule. The integration was carried out using Acando’s standard SAP interface.

Altia started working with RELEX in December 2012. Altia decided to begin with its operations in Finland and Sweden. The implementation began within a month using products from two suppliers. Then the rest of its product range, both own brands and from suppliers, was pulled onto the system during the three months that followed. RELEX was introduced in Estonia in January 2014 and later in the year in Denmark and Latvia.

Goals

  • Unified processes and practices of different sales groups and territories
  • The division of outlet forecasting and procurement planning into separate teams but with the process remaining integrated and unified
  • Increased automation in planning
  • To improve the reliability of system-based forecasts and purchase proposals
  • To be able to focus on handling exceptional situations and to be better able to handle forecasted changes
  • Unified indicators (KPIs) and global visibility across forecasts
  • Improving service levels
  • Improving inventory turnover
  • Extending optimised loading of transport units to encompass ordering several different products

Results

Altia found its experience of using RELEX very positive both in terms of ease of use and of results. During the first year:

Forecast accuracy in Finland improved on average by 9 percentage points

Safety stock levels decreased considerably

Product out-of-stocks reduced significantly

RELEX’s inbuilt reporting tool provides a flexible and near-real-time view of the situation right across the Group at any given level (shop/division/warehouse/group etc.)

The use of RELEX at Altia is based largely on exception management. For all products, base forecasts and purchase proposals are automatically calculated. However, RELEX systems can be set to focus on exceptions when analysing data. In exceptional situations, such as demand peaks or demand during special events, the system will automatically flag them based on the alert limit that the user has defined. This makes dealing with exceptions, in accordance with the business’s overall goals, easier and more effective.

Feedback on the RELEX system from end users has been good. Altia’s users have been particularly pleased with the fact that editing their view [UI] in RELEX to fit their own needs is easy and flexible. They’re not obliged to see the view or all of the reports defined or pre- configured by the administrator.

In the future, use of RELEX demand forecasting will be expanded to cover Norway and Altia’s Cognac business.

RELEX is a flexible forecasting and supply chain planning partner. RELEX handles the SAP environment very well and therefore the coordination/unifying of the systems was quick and efficient.

Jussi Hyvärinen

Project Manager, Altia

In the past, Group-wide data collection and analysis was a challenge and took a lot of time. The RELEX system gathers information quickly and at all desired levels, and we can also set up automated reporting to meet different needs. For example, different countries’ sales forecasts can be viewed singly, as a whole, or at different levels.

Lauri Helin

Project Owner, Altia

RELEX delivers measurable results in months

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