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FMCG - Fast moving consumer goods

For whom is this offer?

The offered solution is intended for enterprises making consumer goods, mainly those which have:

• A considerable sales turnover;
• A great number of items in the product range;
• A relatively low profitability index;

Today, several pronounced tendencies can be observed on the consumer goods market:

• Branch growth retardation
• Intensive struggle for the market share among manufacturers
• Change of retail trade formats (increase of network retail share)
• Acceleration of the rates of growth of new product implementation at goods lifecycle reduction

Typical tasks of the consumer goods enterprises

Conduction of business by consumer goods manufacturers is accompanied by the following factors:

• Presence of a rough competitive environment: as a result of company merger and takeover, powerful structures occur which are able to compete in the struggle for the customer due to the higher quality and wider range of their products, price reduction and better understanding of customer’s needs;
• Constant pressure on behalf of consumers which forces to reduce prices and increase quality of goods and post-guarantee service;
• Gradual increase of manufacturing costs due to increase of expenses on raw materials and the wages fund (of all kinds of resources consumed);
• The need for adequate and timely reaction to constantly changing requirements of state authorities;
• Occurrence of substitute goods on the market;
• Entrance of large international manufacturers to the Russian market;
• Ageing of fixed assets and the need for their constant upgrade.

What actions does the management of consumer goods enterprises take to ensure efficient work in conditions of constant competition? What does the management need for increasing company’s turnover and profit?

• Form and maintain an optimal product range which brings the biggest profit and customers’ satisfaction (the so called assortment or brand portfolio)
• React promptly to constantly changing customers’ requirements
• Use the most efficient methods of demand forecasting together with distributors and retail operators
• Form a portfolio of sales orders with the required degree of diversification for optimal planning of production capacity use
• Find additional possibilities for efficient management of working resources, using reliable and laconic business analytics

In order to ensure adequate return on investments and efficiency of working assets use, maintaining and further growth of profitability, quick reaction to market situation change, beneficial use of new business opportunities, managers of consumer goods companies shall have the necessary tools.

The essence of our solution

For consumer goods enterprises, ALPE consulting offers a solution, possibilities of which cover the whole complex of management activity. The solution was created based on our experience in consumer goods enterprise automation and is built on the SAP Company platform, leading in the field of application software, as well as best world practices.

The solution for the consumer goods industry gives company managers an opportunity to determine tendencies in increasing business efficiency, determine and assess financial results of company’s activity, determine the most cost-plus and the most profit-making products and subdivisions, track realization of sales and purchase plans, timely correct the price policy, the discount system, construct correct logistic chains etc.

Solution “ALPE Consulting: For the consumer goods field” gives the following opportunities to company managers:

Form and maintain an optimal product range which brings the biggest profit and customers’ satisfaction (the so called assortment or brand portfolio)

Product range optimization is very important for a company making consumer goods. An excessively wide product range leads to competition among own brands, an extremely narrow one – to loss of a part of the market. Only quality and regular collection of market data, price monitoring allows competent and efficient formation of a product (brand) range.

Solution “ALPE Consulting: For the consumer goods field” allows obtaining and analyzing data from various reports according to the necessary analytical features: the customer, sales dynamics, sales volumes of each product separately, as well as comparison of product sales results in time or for a given comparable period.

Our solution will allow deep study of consumers, analysis of sales point and sales area types in order to make a decision on choosing the most efficient means of product promotion; compare sales volumes of various products in time for determining the required product range.

React promptly to constantly changing customers’ requirements

In conditions of rough competitive struggle on saturated markets, each consumer is important for companies making consumer goods. Loyal consumers have become the most valuable asset of any company. In this respect, one of the most important tasks is sales market segmentation – determining more or less large groups of consumers with similar preferences. Correct positioning of a product, determining groups of consumers for target advertising and marketing actions, product range optimization can considerably increase the degree of needs satisfaction, the average amount of purchase, as well as attract new clients.

Using our solution, analysis of consumer groups can be performed almost by any available analytical sections: purchase volumes, number of purchased goods, number of consumers and many others.

Use the most efficient methods of demand forecasting together with distributors and retail operators

Analyzing the market position, consumer goods companies usually pay primary attention to assessment and forecast of the business environment, first of all to its elements such as demand, offer and price. At present, it is not sufficient to determine goods of limited demand and avoid their further entry to the market. It is necessary to anticipate occurrence of a problem situation on the market.

Solution “ALPE Consulting: For the consumer goods field” allows forecasting a company demand. Forecast may be performed based on historical data with the possibility of further correction and cleaning of data, determining falling-out values, use of statistic models during forecast. Forecasting is performed based on various extrapolation methods. When planning demand, any planned company’s activity may be taken into account, e.g. advertising campaigns.

Forecasting is possible not only for the existing nomenclature, but for new products as well. Forecasting may take into account joint operations with partners.

Inclusion of sales partners into the common planning system allows increasing their loyalty, overall stability of the sales network operation, and considerable improving of the indicators of the enterprise’s sales volume due to sales plans, preliminarily coordinated with partners, and possibilities of stimulating the realization of this plan. All forecasts may be formed based on the set strategic indicators.

Form a portfolio of sales orders with the required degree of diversification for optimal planning of production capacity use

One of the main tasks for different clients of consumer goods enterprises is timely ordering of goods on the most favourable payment and delivery terms for them. There are many important tasks during analysis of goods purchase by enterprise clients, from cash planning based on previous experience to controlling of managers who choose suppliers. Correct sales forecasting by various groups of goods, determination of a sufficient stock of goods at warehouses (taking into account periods of storage and the system of supply to clients), optimization of payment terms taking into account the forecast of sale of free working resources will allow reducing warehouse stocks and, consequently, free additional working resources and optimize use of the plant’s production capacities.

The working resources using in FMCG - Fast moving consumer goods are usually rather large, however, the task of correct management of such facilities is vitally important. Freeing of even a small additional amount of working assets may give an additional financial source to the enterprise, and, consequently, increase of business profitability on the whole.

Find additional possibilities for efficient management of working resources, using reliable and laconic business analytics

How can one understand what sources of additional working assets have not been used yet or are inefficient? What are working assets spent on?

Solution “ALPE Consulting: For the consumer goods field” allows analyzing turnover of non-cash and cash resources in the section of trade operations, contracting parties, currencies and time for the purpose of optimizing flows, ensuring liquidity etc.

The Result

Solution “ALPE Consulting: For the consumer goods field” is used by directorates of sales, finances, management of delivery chains, top management of consumer goods enterprises.

The solution efficiency, along with quality indicators of the information system reflecting a high level of logistics coordination, operational and accurate management accounting, the possibility of accounting statement generation in accordance with Russian and international standards, is also determined by the amount of investments in information system implementation.

Solution “ALPE Consulting: For the consumer goods field” is seen as a one-time investment in information system implementation.

The offered service package includes:

• A server with preinstalled complete system SAP ERP and preset scope according to the best practices Business All-in-One
• Standard SAP ERP licenses
• Additional adjustment of the system to Customer’s requirements within the framework of the given solution scope and SAP standards
• Training of Customer’s key users (instructors).
• Delivered documentation of end users of the solution SAP Business All-in-One
• Support in preparing and loading Customer’s basic data by standard input files
• Support in productive system start and 2 months of postproduction support

Such a complex approach allows quick obtaining of procedures, fully integrated into the information system, which reflect the essence of business processes of enterprise management and absolutely non-contradicting data obtained from various sources. Thus, the effect of information technology use at the enterprise is realized to the full.

A considerable increase of operativeness of production process data allows optimizing the use of capacities and reducing stock volumes in unfinished production.

Thus, the use of SAP All-in-One solution allows:

• Reducing specialists’ working time spent on site up to 5-10% due to document preparation automation;
• Reducing cargo transportation costs by 30%;
• Increasing warehouse personnel labour productivity up to 25%;
• Reducing time of cargo loading to the warehouse by 25%;
• Reducing the amount of unliquid assets at production by 15%;
• Ensuring stable growth of the client base by 10% a month;
• Reducing time of report generation within the framework of quick closing up to 3 days;
• Increasing operativeness of management decision making by 25%.

ALPE consulting offers a complete range of services in SAP solution implementation for Russian and international companies of various fields in Russia, CIS and Europe.

Successful clients are the best recommendation!

Detailed information can be obtained from our specialists by telephone:

+ 7 495 660 20 19 or e-mail: info@alpeconsulting.com