Distribution-free forecasting methods help Anita to optimally assess customer expectations
By Felicitas Heid-Davignon, Dr. Bernd Reineke
Hardly any other industry is as dependent on the correct assessment of sales potential as the clothing industry. Anita Dr. Helbig GmbH therefore decided to use the Diskover SCO (Supply Chain Optimizer) forecasting and scheduling system to support sales planning in order to forecast customer expectations as optimally as possible using scientifically supported distribution-free forecasting methods.
The special feature of this installation is the black box, which works in the background. This means that no training is required to select the appropriate procedure, as the system works independently.
As a stock manufacturer, Anita relies on good planning to avoid unnecessarily high stock levels, while still being able to deliver the items ordered by customers on time. A particular problem is that the number of new models and/or color designs is constantly increasing.
As a result, the number of planning items is constantly growing. The greater the number of variants, the greater the irregularity, which makes it all the more difficult to estimate the sales figures for each planning item. In the past, sales figures were calculated by averaging past values. As a result, product trends were only recognized very late – and with the simultaneous change in the product range towards more frequent product changes, the quality of planning declined. This led to increased inventories of non-turners and a lack of availability of items in high demand, which is annoying for sales and customer satisfaction.
Good planning optimizes stock levels and delivery readiness at the same time
To improve the situation, Anita Dr. Helbig decided to support the planning process with a specialized planning tool. The choice fell on the DISKOVER SCO system from Abels & Kemmner, due to the:
- The option of simulating the supply chain with the target delivery readiness level as an optimization criterion and selecting the most suitable forecasting methods and parameters
- The dimensioning of suitable safety stocks to cushion sales fluctuations and supply bottlenecks and
- The ability to automatically determine sales expectations without manual effort.
Before DISKOVER was implemented, a detailed analysis of the sales items was carried out. By simulating several scenarios, the readiness to deliver and the inventory level were optimized. In particular, the addition of distribution-free methods showed significantly better results than simulations without these control variables.
Detailed analysis of sales items
Distribution-free methods should always be used if the fluctuation in consumption values per period is not normally distributed. Experience shows that only around 25 percent of all consumption series are normally distributed, i.e. three quarters of the items to be forecast do not have a normal distribution. Such items can therefore only be forecast to a limited extent or not at all using the standard methods of conventional forecasting or ERP systems, as these usually only offer methods that assume a normally distributed demand (e.g. mean value method, exponential smoothing). If the normal distribution is not given, conventional forecasting methods produce very inaccurate results and lead to incorrect delivery readiness levels.
At Anita, DISKOVER SCO was initially only to be used to optimize the demand forecasts. Special requirements, such as the regular adjustment of batch sizes taking packing units into account, were also implemented within a short space of time. After coordinating the data structures and additional functionalities, DISKOVER SCO was put into operation in just a few weeks. When selecting the DISKOVER database, expensive and complex solutions such as MS-SQL or Oracle were deliberately avoided. Microsoft Access was selected as an inexpensive solution, which is completely sufficient in terms of both the expected data volume and performance and also offers simple options for evaluating the data flexibly and in line with requirements.
For the optimization, DISKOVER SCO receives the interface data such as master data, movement and order data in the form of ASCII files with a pre-agreed structure. Optimization runs lasting several hours are then carried out once a month, usually at the weekend. After optimization, the results are transferred back to the higher-level ERP system of Pohl Softwear GmbH based on an AS/400 computer in the form of text files. DISKOVER SCO therefore works as a black box in the background without direct intervention by the dispatcher.
Due to the high degree of automation, this solution can be operated without great effort. And since the planning tool functions as a black box, no training is required. The monthly optimized forecast data is made available in the leading ERP system Softwear without changing the front end. Consequently, nothing has changed for the dispatchers. Only the delivery readiness and the inventory situation improved continuously. All this is achieved without much intervention in day-to-day business and simply by selecting the right scheduling procedures and parameters.
Anita – a specialist supplier of corsetry
As a specialist supplier of corsetry, swimwear, e.g. also for expectant and nursing mothers or special medical products for aftercare following breast operations, Anita forms a competent, internationally active network of 20 individual companies with a total of approx. 1,200 employees and an annual turnover of approx. 80 million euros. The share of sales outside the core markets of Germany and Austria is already well over 50% and is rising sharply. Sales are preferably handled by the company’s own subsidiaries, in some cases via exclusive importers.
The company’s own production sites are located in Germany, Austria, Portugal, the Czech Republic and the Far East. In addition to sampling, practically all prefabrication takes place at the Brannenburg site. The highly elastic materials used place special demands on the cutting of the parts in order to achieve the best fit. Cutting to size is therefore a core competence in the production process. This and the technical complexity of cutting on a cutter line mean that this work step is largely concentrated at the Brannenburg site.
The company sells a wide range of articles in many sizes. Four product ranges are sold in the corsetry segment, which differ in terms of their target groups, their demand structure, their contribution margins and the dynamics of fashion changes (Care; Maternity; Classics; Rosa Faia). There are also bathing collections for the same target groups, which are produced to pre-order. http://www.anita.com/
