Improving the Retail Food Supply Chain

N.Y.'s Wegmans, Italy's DeSPAR tap Retek solutions

Minneapolis  January 15, 2003  Food retailers on both sides of the Atlantic are turning to new solutions to help improve their supply chains.

This week brought the news that Rochester, N.Y.-based chain Wegmans Food Markets and DeSPAR, an Italian grocery retailer and wholesaler, have both signed up to use solutions from software company Retek.

Wegmans, an 87-year-old, 64-store supermarket chain in New York, Pennsylvania and New Jersey, will use Retek's Demand Forecasting, Promote and Replenishment Planning solutions in a bid to improve its supply chain efficiency and increase inventory performance.

Retek said the Demand Forecasting solution, combined with the Promote module, leverages scientific technologies and promotional and causal factors to develop consumer demand at levels as low as stock keeping units (SKUs)/store/day. These forecasts are integrated with the Replenishment Planning solution to drive time-phased order plans that are synchronized with such nodes in the supply chain as stores, warehouses and suppliers.

The privately held, $3 billion Wegmans is counting on the solutions to improve the efficiency of its operations with more accurate and detailed forecasts to drive logistically efficient replenishment plans at the store and distribution center (DC) levels.

"Forecasting and replenishment processes have a significant impact on store operating performance and customer service," said Don Reeve, senior vice president and chief information officer of Wegmans. "Improvements derived from consumer demand, forecast and time-phased replenishment orders will allow Wegmans to improve inventory turns and continue our tradition of providing excellent customer service."

Meanwhile, on the other side of the ocean, Italy's DeSPAR, a 71-year-old, $1 billion chain of more than 17,500 shops in 30 countries on five different continents, is reporting improvements in its supply chain operations after adopting Retek's Supply Chain and Merchandising Operations solutions.

DeSPAR's previous retail and wholesale operations were on multiple systems and methodologies that were not integrated. Working with Retek and a systems integrator, Enabler, DeSPAR has deployed Retek's Supply Chain and Merchandising Operations solutions to integrate and improve the performance of its retail operations and its four Italian distribution centers, which supply 620 grocery stores across Italy.

Giancarlo Pelarin, IT director at DeSPAR, said Retek's Distribution Management, a warehouse management system, has enabled the company to operate its four warehouses with one less shift per day, taking 2,240 man-hours out of the daily supply chain. "With the Retek solution our pick accuracy to stores has improved to 99.8 percent from 80 percent," Pelarin added.

In addition to Distribution Management, DeSPAR has deployed Retek's Merchandising System and Data Warehouse solution.