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Carrefour improves on-shelf availability by 7%

12-10-2018
Carrefour

With more than 600 stores in Turkey, food retailer, Carrefour SA regularly struggled with out of stock situations. One of the biggest problems was that the retailer’s inventory management activities relied heavily on the knowledge and experience of the inventory planners, who are moreover in very short supply in Turkey. Thanks to Slim4, Carrefour SA has succeeded in standardising, centralising and automating the replenishment of its DCs and its stores. The initial results – fewer planners and higher on-shelf availability – demonstrate the potential for even more improvements.

Despite the country’s challenges, the grocery retailer Carrefour SA continues to show strong growth in Turkey. With over 600 stores ranging from hypermarkets with more than 50,000 SKUs to supermarkets, convenience stores and specialist shops. The retailer not only sells food and drink products, but also non-food items such as textiles and electronics. The stores are replenished via an extensive network of seven regional distribution centres (DCs), three DCs for fresh produce, one DC for fish and seafood, and one DC for frozen food. Due to an ongoing acquisition strategy, the number of stores is constantly rising and the retailer currently has over half a million square metres of floor space. But the rapid growth added to the pressure on Carrefour SA’s supply chain, resulting in frequent out-of-stock situations which were damaging the retailer’s customer service level.

At the same time, Carrefour SA was being forced to write off a lot of inventory because products remained unsold. However, by far the biggest problem was the lack of the right knowledge and skills to turn things around. “There is a high level of staff turnover within the logistics and inventory planning teams, plus it’s very difficult to find new people. Not many Turkish universities offer good degree courses related to supply chain management. We have to make do with newly graduated technical engineers and then help them to develop the relevant competencies ourselves,” says Emri Aslan, Supply Group Manager at Carrefour SA.

Standardising process

carrefourCarrefour SA realised that the existing store replenishment process had to be redesigned. The retailer was too reliant on Excel sheets and the knowledge inside the heads of its inventory planners. “Partly also due to the shortage of supply chain talent, we wanted to standardise the replenishment process and relive some of the preasure placed on our employees. We implemented SAP for things like warehousing and inventory management, but the ERP suite’s replenishment module didn’t offer enough functionality for us. The problems with on-shelf availability in our stores meant that we had a pressing need for an advanced forecasting and replenishment tool,” continues Aslan. Carrefour SA came into contact with Slimstock through the local consultancy firm Selco.

After carefully comparing it with the SAP Forecasting & Replenishment and NCR Retalix systems, Aslan and his team decided on Slimstock’s Slim4 tool. “It might seem more logical to have chosen SAP Forecasting & Replenishment seeing as our ERP system is from SAP, but no one uses that module in Turkey. Our ERP system has been substantially customized, so there was little – if any – benefit to be gained by staying with just one software supplier, so we preferred Slim4. The tool has user-friendly screens, is easy to learn and to work with, and the same version is available worldwide. Besides that, Slim4 allows us to create a process that will reduce our dependency on people.”

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will severn

Will Severn

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