Safety Stock podcast starring Dan and Will

Bringing Decision-Making Closer to the Consumer

We understand it, demand forecasting is tough and the needs of the consumer are always evolving. Sit back and listen from beginning-to-end as we simplify your operations model and bring you the end-to-end visibility you need to clean out your supply chain process.

Will:
All right, everybody. It is the favorite time of your day. It is Safety Stock with Will Davis. I’m here with Dan Magida and Dan, I think we’re gonna give the people something special today.

Dan:
Well, I just guys backtrack a little bit. What is your favorite time of the day? Do you have like a, dedicat like sweet spot of window of time that you just long for?

Will:
It’s so day dependent. I think that, you know, like from a working perspective, lunchtime, I love lunchtime. I’ll be honest.

Dan:
Yeah.

Will:
I’m excited about lunch. Cause I feel like I’ve gotten the morning things taken care of, and I know what I need to do in the afternoon, but I also love food.

Dan:
It’s that real refueling time of day for you.

Will:
It’s the refuel. Yeah. It’s the, you know, it’s like, Hey, are we on the right track? Or should we fix where we’re going?

Dan:
If you don’t get that good lunch in, I mean, it does can make or break or day too.

Will:
Yeah. I mean, breakfast is important. Lunch is important, dude, small dinners. That’s what everybody says.

Dan:
Small dinners, well, going to sleep on a full stomach is not enjoyable.

Will:
Right. Right. And you know, a nutrition podcast may be coming, but for now, , we’re going to talk about how you get close to your customer data and your information in terms of what’s selling. Are you streamlined to the point to where you can take that data and then properly act on it? It’s something that a lot of companies struggle with today. They may be good at parts of it, but they’re not necessarily holistically good at everything. And so a good example of, you know, what we’re talking about is, you know, during the pandemic, a lot of companies saw their overall sales increase. You know, for example, if you were in the personal good section, if you were home decor, kitchen supplies, you name it, things were great. What we’re seeing now is that as some of that demand slows people have been affected by inflation. They are affected by having more inventory than they anticipated. And overall, it’s going to take a toll on their profitability. What are the things Dan that the a company can do in order to change some of those things to get to a point to where they need to be?

Dan:
Yeah. I mean, end to end visibility is super important for, for all businesses and just knowing what you have on order at the basis of your beginning of your supply chain to end result, what are your consumers customers buying through e-com distribution, retail, distribution, super important that you’re really dialed in and understanding your true customer base. And we know demand forecasting is challenging. I’ve D I personally have done in the past as well, more on a retention model and also one off model too. And looking at those trends, if it’s seasonality I mean, pandemic has definitely made it a lot tougher where like that stay at home culture where, you know, it’s gonna last, but how long is it gonna last for? Are you still gonna have that demand? Then you have those freight implications as well. And then everything on top of it, not a, not a great time to be in that space because you just don’t know when the peak is gonna happen. And then bracing for that peak is really hard because then you’re gonna have an issue where you may have an influx of inventory. And we’ve seen like retailers have to offload and start discounting. So end to end visibility is very, very important in understanding. And a lot of team members go into it and working together is critical. In capturing that.

Will:
Yeah, I think, you know, people need to understand as decisions are made closer to the customer, having access to your point of sale data, people will say POS is super important. I think that’s ultimately where you’re getting true feedback over what items are moving. You know, Dan and like what’s not, and when brands don’t have as close of access to that, I think that’s when they’re left to guess more when it’s a little bit slower or, you know, it’s not necessarily as nuanced or they don’t know how to manage that big data as it’s coming in. When I was at L brands, you know, they were getting, you know, real time data as it came in. And you were seeing it as soon as like 12 hours in terms of what a store sale was, 24 hours. You, you knew what was moving consistently and you could see it as it went in through the day previously, you know, so they have the ability to go and push different items or order it on certain programs that they say, okay, we’re setting this up as an Insta program to where they can order certain goods, you know, at bath and body works.

Will:
And they say, Hey, I know this hand sanitizer selling well, and this one’s not, I’m gonna make more labels for this hand sanitizer so I can have it available next week. That’s important because then you’re not being stuck with, you know, the hand sanitizer that nobody wants to buy.

Dan:
Yeah. I, I think that the hard part or that the delicate area is going a lot of supply chain is like, you’re reactionary in a sense where you’re, you’re reacting to what, what just took place and then building your forecast off of that. Like how can you maybe shift that to your point, the POS data, integrating your systems in and understanding like what your e-com and supply chain footprint is, is very important, but how do you, you make that change where you’re not reactionary, where it’s like, you have to wait for the next quarter or two quarters after that to make, to implement those changes. Can you do anything in real time to your point where if you need to pivot, you can pivot, what does it look like in terms of your supplier relations as well? Can you, can you lessen your demand? Are you vertically integrated? There’s a lot of factors that go into it as well. Which makes it tough. Like it’s having a flexible forecast makes it hard, but you also want to know what are the, the minimums I have in terms of what repeat buyers do. I know I’m gonna have repeatedly month over month and forecast against that as well, and then have a model as well for your, for your net new customers on top of it.

Will:
Yeah. I mean, there was an article that talked about Clorox. They were trying to simplify their operations on that side and they were, you know, they’re getting rid of a legacy E R P system that they used and moving more to a cloud based system. And, you know, this lends it to two thoughts. One, you know, when you have these older legacy systems that you, you don’t change because you’ve always had it and it’s expensive, you’re ultimately pushing the problem down the road. And then the second thing ends up coming is that you end up consciously or subconsciously, you know, structuring your organization based on how the information’s being presented to you. And if it’s in an ineffective way, you’re effectively building ineffective processes based off an ideal process. So a good example means would be, you know, if you’re a, if you’re a company and your supply chain operations team, isn’t in the same meeting or getting the information at a similar time with your sales and your demand planning team, and there’s a lag you’re ordering is going to have a lag to it versus you’re. Now, if you’re putting those groups together or you’re sharing the information at the same time, and you’re making fast smart decisions, you can act at a really high pace in terms of responding to what your customer is, ordering those things are needed.

Dan:
Yeah. And to your point with Clorox, hopefully simplifying their, their model, a not to a, to go faster, but also to boost savings. Walmart’s doing, doing something similar targets, doing something similar bunch of e-com companies that have generally tougher years so far that we’re ed by the probably stay at home pandemic are, are doing the same thing as well. They’re looking at this. And unfortunately it may come with some layoffs and restructuring, which nobody nobody wants. But they’re all trying to get focused on how can we pro put ourselves in a better position, better clarity in our supply chain workforce, cuz supply chain operationally is what ultimately like drives the lot of the success of these businesses.

Will:
And so, you know, I think overall, you know, from a company perspective, I, if you’re helping, you know, make changes and ultimately decide like where your company’s direction is, you know, having access to your data, having visibility across your system is ultimately going to give you the best chance of making the right hires and giving you the right process to continue to drive things forward.

Dan:
Well, if any of you guys have any questions or insights on it, the best way to consolidate or get those data driven insights into your supply chain from any size business, you can be a, a true person shop all the way to fortune 500, let us know always here to help out, give you tips, advice on how to best read that data and set that up so

Will:
Nice. And that’s at, you can reach us at hello@anvyl.com. That’s A-N-V-Y-L.com and we look forward hearing from you. We will talk to you soon.