Always Enough, Never Too Much
Kirin Brewery Company Accurately Forecasts – and Meets – Demand
Ensuring appropriate inventory is one of the key business goals for any manufacturer, making effective supply chain management (SCM) a priority. Failure to control inventory can have a huge influence on the whole business, including lost sales opportunities caused by short stock and unnecessary costs incurred by excess inventory.
The Kirin Brewery Company markets approximately 700 product items, including domestic and imported beer, whiskey, liqueur, shouchu and wine. It was determined to carry out a radical renewal of the supply/demand planning system to effectively manage its inventory. The Spirits and Wine SCM System project, which began in April 2003, was based on SAS Supply Chain Intelligence, and brought about dramatic improvements in demand forecast accuracy and the automation of complicated procurement processes. By adjusting inventory levels, the system contributed to cost savings and improved operational efficiency.
Building a New SCM System to Improve Efficiency
"We are not just a beer brewery, but a comprehensive beverage company offering a wide variety of products. We strive to retain consumers' continuous support. To do this, our logistics division, in collaboration with SAS, has developed a new supply chain management system where all current and future distribution can be optimized by demand forecasting. Currently, ordering, shipping and any changes in inventory for spirits and wine can be consolidated and controlled, based on the methods we have developed for beer and happoshu (low-malt beer). By fully utilizing the system, we are determined to meet customer demand and improve business productivity," says Keigo Kubota, Manager of the Spirits and Wine Logistics Section, Logistics Division of Kirin Brewery Company.
Demand Forecasting for Managing Lead Times
The Spirits and Wine SCM System has two major strengths. One is that the procurement operation, including order planning and future stock simulation, is now an automated system. Another strength is that the demand forecast and shipment plan are logically calculated using an appropriate analytical method.
Choosing the Most Relevant of Seven Forecasting Models
"Demand forecasting is the key to achieving the objectives of proper inventory. We chose SAS for this solution because of its forecasting accuracy. We asked potential vendors to model actual historical data. We examined and compared the results and found that SAS presented the most accurate forecasting. In addition, SAS offered the best performance in comprehensive cost evaluations in the initial and operational stages, the most experience in system implementation in Japan, and the highest customer support capability and processing speed," explains Ishii.
Aiming to Improve Forecast Management
The results illustrated in this article are specific to the particular situations, business models, data input, and computing environments described herein. Each SAS customer’s experience is unique based on business and technical variables and all statements must be considered non-typical. Actual savings, results, and performance characteristics will vary depending on individual customer configurations and conditions. SAS does not guarantee or represent that every customer will achieve similar results. The only warranties for SAS products and services are those that are set forth in the express warranty statements in the written agreement for such products and services. Nothing herein should be construed as constituting an additional warranty. Customers have shared their successes with SAS as part of an agreed-upon contractual exchange or project success summarization following a successful implementation of SAS software. Brand and product names are trademarks of their respective companies.
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From left to right: Katsutoshi Ishii, Logistics Division, Planning Section; Yuko Hamamoto, Logistics Division, Spirits and Wine Logistics Section; and Keigo Kubota, Logistics Division, manager of Spirits and Wine Logistics Section
Kirin Brewery Company
Kirin needed a highly accurate supply/demand forecast system.
SAS Supply Chain Intelligence helps the Kirin Brewery Company move its inventory faster and perform better demand forecasting.
“We examined and compared the results and found that SAS presented the most accurate forecasting.”
planning section, Logistics Division