Case Minimani: Hypermarket Chain Cuts Food Waste Through Supply Chain Optimization
Minimani is a Finnish hypermarket chain offering grocery and convenience goods at low prices. Minimani is slightly unusual in that it only has five stores but four of those are major hypermarkets, along with one smaller store and an e-commerce channel together accounting for more than €100M in sales.
These large stores, with their vast range and volume of products, operate on a direct delivery basis with no intermediaries and no central warehouse. This makes replenishment and delivery optimization critical to Minimani’s operations. Minimani therefore decided on a complete overhaul of its replenishment and delivery processes using RELEX.
“RELEX listened to us and understood our needs perfectly.”
– Heikki Tynjälä, Managing Director, Minimani
Starting point and goals
Minimani had been keenly following RELEX’s growth and success over a number of years and concluded that its technology and expertise best met the company’s needs. Previously the hypermarket chain had relied on manual ordering processes, whereby each store’s demand planner ordered products directly from suppliers. Given the huge size of the stores as well as the wide range of products, this resulted in an enormous workload, and moreover made managing waste and availability very challenging.
The end-goal of implementing RELEX was to reduce the manual workload generated by ordering, while cutting waste and improving availability. Minimani’s business model is highly campaign-driven; the company has ‘start-of-week’ and ‘end-of-week’ campaigns every week, along with various additional promotions. Therefore, effective campaign management was also a key reason for implementing the RELEX system. However, Minimani’s overriding aim was to increase its customers’ average spend while speeding up inventory turnover.
RELEX was first introduced in 2017. Minimani piloted the system at its Seinäjoki store with a limited number of suppliers. More suppliers were gradually added to the system. Following the project’s successful start, other Minimani stores were brought onto the system. The intention is for the widest possible range of products to be managed within RELEX.
Prior to the RELEX implementation, Minimani had introduced a NAV ERP system, so it was important that it could be integrated with RELEX during the project. Minimani also uses RELEX to optimize batch sizes to match demand. This means that rather than keeping large quantities of products in its store stock rooms, goods can be shipped directly from the suppliers to each stores’ shelves.
“RELEX has made it possible for us to execute campaigns quickly and on time, and to focus more on future events rather than looking back to see how things were done previously.”
– Sarita Orpana, Project and Development Manager, Minimani
“RELEX listened to us and understood our needs perfectly,” says Minimani’s Managing Director Heikki Tynjälä. “Together we have created a new automated replenishment process that has helped us reach all the goals we set for the project.”
Minimani now has a centralized team that manages replenishment ordering. As a result, it has been possible to refocus employees on other important tasks such as customer service. After implementing RELEX, Minimani has been able to save several working hours every day that were previously accounted for by replenishment ordering.
By spring 2018, the availability of the most important product lines in Minimani’s Seinäjoki store had improved by 4%, which has boosted their sales performance. At the same time, waste, particularly with meat products, has decreased significantly.
“RELEX has made it possible for us to execute campaigns quickly and on time, and to focus more on future events rather than looking back to see how things were done previously,” says Minimani’s Project and Development Manager Sarita Orpana.
“Managing chain-wide campaigns and their in-store execution has also become much easier and these days Minimani runs campaigns much more systematically, which we also expect to increase sales.”
“The next step is to focus on optimizing deliveries through the use of main delivery days and taking factors such as available shelf space into account,” says Orpana.
- Employees able to focus on other important tasks such as customer service
- Availability of the most important product lines improved by 4%
- Waste (particularly with meat products) decreased significantly
- Easier to manage chain-wide campaigns and in-store executions
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