HAVI helped a quick-service restaurant (QSR) that had sales 200 percent above forecast for their new ice cream product without any advertisements or campaigns. Since the demand posed a serious supply risk, HAVI recreated forecasts to ensure production would be in line with the most recent sales data.
CASE STUDY FOCUS: ADVANCED PLANNING
Forecasting and supply chain management enable a quick service restaurant (QSR) chain to meet unprecedented high consumer demand for a limited-time dessert offering.
A QSR chain introduced a new flavor of its flagship ice cream dessert for a 12-week period. Promotion of the offering was limited to in-store merchandising. There was not a national promotional campaign, nor were there television or radio advertisements. Despite the understated promotion, the dessert was extremely well received, with sales trending 200 percent above forecast the first week of the offering.
The unprecedented demand posed a serious supply risk for the chain’s 10,000+ restaurants given that the ingredients needed to support the limited-time offer were produced and secured in advance, due largely to the complex nature of the new product specifications and suppliers’ need for long production lead times. If sales continued at such a high rate – and updated forecasts predicted they would – the chain would have only enough supply for four weeks instead of the planned 12. The chain’s ability to deliver on its promises and meet customer demand were at stake, as were millions of dollars in potential sales.
The QSR chain sought help from partner HAVI. The world’s most respected brands rely on HAVI to deliver a competitive advantage on their most demanding and complex challenges across the global business supply chain. The chain knew HAVI would help it successfully navigate this unexpected event, minimize risk and ensure enough supply to meet demand.
Communication and planning were essential and HAVI consistently fostered both across the supply chain. Leveraging its visibility into the chain – from suppliers to distribution centers to restaurants – and its access to real-time data, HAVI was able to recreate forecasts and adjust these daily to ensure production would be in line with the most recent sales data. Confident in HAVI and its plan, partners across the supply chain remained calm and worked collaboratively to assure the promotion’s success.
In one instance, HAVI worked with the QSR chain and its suppliers to adjust the specifications of the product so production would be faster, without compromising quality or taste. HAVI also helped negotiate new production lead times so suppliers were producing immediately and at higher volumes. Additionally, HAVI allocated inventory levels and coordinated logistics to move product to distribution centers and restaurants as quickly as possible.
As a result of these efforts, HAVI ensured product was used optimally and that the chain did not break supply in any of its locations. The promotion was fully supported throughout the entire 12-week window.
• Recovered sales – The QSR chain was able to maintain supply across 10,000+ retail locations during the entire 12-week promotion and avoided lost sales that would have resulted if supply ran out after only four weeks.