Poorly run supply chains result in more than high operating costs alone. Poor customer service, poor sales performance and cash flow problems are typically some of the symptoms. In the end margins will suffer and, over time, so will market share. This case study tells the story of our client who decided to actively address these issues.
Our Client is a market leader in marketing and distribution of agricultural products with 28 Area Sales Offices, 25 Depots, 8 Regional Offices, and a Head Office.
The business had gone through a period of dramatic but uncontrolled growth, resulting in serious distribution channel issues and substantial losses. It was at this point that the Client engaged Renoir to help overcome these challenges.
ANALYSIS & PROJECT APPROACH
Renoir carried out a detailed study of Rallis’ internal management capability and external marketplace identifying 6 key issues:
- Lack of market information
- Little control over its sales force
- Little control over the distribution channel
- High levels of debt
- High levels of inventory and channel stocks
- Poor availability at retail level
Following the analysis, the Renoir team recruited employees to form a Task Force. Over a 6-week period, the team conducted the Focus Process™, which includes data collection, observation studies and opportunity quantification before design and solution development.
Renoir helped the company regain control of the distribution channel by developing and implementing a secondary sales channel management system.
This helped the company manage its sales and distribution channels more effectively, because it provided better visibility, control, and coordination across the entire supply chain. The system tracked inventory levels, monitored product availability at the retail level, managed the performance of its sales force and intermediaries, and analysed market data to make more informed decisions about inventory management, production, and distribution.
Benefiting from the insights from the system, appropriate marketing strategies and processes were developed to liquidate stocks, introducing new products into the market, and bring major cost drivers back under control.
The changes were first implemented on a trial bases, perfected where required and then rolled out across the country.
Beyond these numerical outcomes, the organisation realised even more significant cultural changes that will be of crucial importance into the future.
As expressed directly by the employees:
“It was amazing to see the changes in the depot before and after; the boxes were neatly stacked, leaky, damaged stock had been segregated, all the bin cards were up to date, and all orders had their accompanying order forms”
“The performance indicators in the Scorecards helped build an awareness of the various factors which affected our performance.”
“The biggest advantage is that deviations can now be reviewed and corrective action taken to remove the deviations speedily.”
“… being exposed to a whole new way of thinking and functioning, new methodologies and techniques have broadened our professional outlook.”
HR Sales & Marketing