Chivas Brothers Toasts Inventory Reductions

Logility solutions drive supply chain improvements at the world's third largest producer of Scotch whisky

Logility's solutions drive supply chain improvements at the world's third largest producer of Scotch whisky

Atlanta — March 31, 2004 — In a bid to improve inventory management, including forecasting, planning and replenishment activities, Chivas Brothers, the Scotch whisky business of Pernod Ricard and the world's third largest producer of Scotch whisky, said it has implemented Logility Voyager Solutions.

In addition to Chivas Brothers, three other Pernod Ricard subsidiaries use Logility Voyager Solutions for supply chain planning.

Pernod Ricard supports operational autonomy of its subsidiaries, enabling operational decision-making to take place at the level of the brand owners and their distribution subsidiaries.

"We implemented Logility to standardize on a way to forecast demand and manage inventory at Chivas Brothers and across sister companies with whom we share supply chain assets," explained Robert Fernie, Logistics director for Chivas Brothers. "The Pernod Ricard culture is more decentralized than the previous structure, which creates a greater challenge to encourage forecasting discipline across other Pernod Ricard divisions."

Chivas Brothers is using Logility Voyager Solutions to determine inventory and replenishment plans, and will use Logility Demand Planning to forecast customer demand and to support the ongoing development of vendor managed inventory (VMI) programs. Chivas has automated its service level agreements with several of its major customers; encompassing items such as minimum stock levels and reorder quantities.

The Internet plays an important part in Chivas Brothers' collaboration strategy with its key customers. For example, Chivas relies on the Web to communicate real-time order information to its customers regarding case statistics (weights, measurements, barcodes, etc.) and shipments (vessel names, estimated arrival dates). Through automated integration, Logility uses the order information from Chivas' enterprise resource planning system to calculate optimal inventory and replenishment actions.

"Logility has helped to reduce inventories in Scotland," said Fernie. "The solutions also enable us to add a higher degree of visibility and stability to several key business processes, including production line planning and dry good purchases."

Pernod Ricard acquired Chivas Brothers through its 2001 purchase of the Seagram distilled Wine and Spirits business, and the company sells approximately nine million cases annually worldwide. Chivas Brothers includes the brands Chivas Regal, The Glenlivet and Clan Campbell.