Predictive Inventory Management for QSRs
Business Problem Statement
- For Quick Service Restaurants (QSRs), there is an impending need to continuously and effectively monitor current inventory status of key ingredients to take pre-emptive & corrective decisions on stock management in stores and timely inventory transfers in the supply chain
- Several factors inhibit the efficient handling of in-store inventory including inaccurate demand forecasting, stock visibility, and lead time variability
- Inaccurate forecasts can lead to stockouts or excess inventory, both of which negatively impact customer satisfaction and increase costs
Solution Overview
- The solution leverages Pega Customer Decision Hub to predict near-term sales for all SKUs and ingredients at each store and offers next-best decisions such as Intra-Store Allocation, Store-to-Store Transfer, Returns Disposition etc. based on Over/Under Inventory calculations
- The solution factors in the variability of key predictors influencing sales such as seasonality, promotions, store location, weather etc.
- The solution will help:
Identify profitable stock transfer opportunities
Minimize out-of-stock and subsequent lost sales by capitalizing on revenue opportunities
Rebuild product assortment across your business
Recalibrate promotions leading to improvised product planning
Solution Architecture
Business Benefits
- Reduction of Inventory carrying costs while maintaining healthy in-stock levels across stores
- Improved Cash Conversion cycles with timely replenishments and identification of intra-store transfers
- Improved revenue due to minimised lost sales and stockouts
- Optimized Promotion Recalibrations like BOGO, Percent Off, Dollar Off etc. based on Under/Over Inventory calculations
- Intelligent Returns Disposition for timely disposal, reduced inventory waste and reduced overhead costs
- Re-Build Product Assortment: Avoid being left with fringe quantities and inventory distortion across your stores & channels