MySales Labs in GoodWine. Customer success story.
Aleksey Grishin, the Head of Logistics at Good Wine shares his impressions on MySales implementation in the flagship store at Mechnikova St in Kiev.
How long have you been working with MySales Labs?
We launched April-May last year (2015) and plan to continue using MySales.
How is MySales used in your company?
All orders are made through MySales automatically. The system is implemented on cloud and we can access its analytics dashboard. If we have doubts about the forecast, we can enter the dashboard and understand why it was produced this way. We also can modify the forecast by setting various predictors that we consider relevant. The system relies on sales of past periods. If the product is new, it relies on similar products that are in the system. Generally, we do manual corrections on very rare occasions.
How often do you actually need to go to the system and correct something?
Typically not more often than once a month. MySales dashboard allows for checking the forecast in detail, but we basically do everything in our ERP integrated with MySales. Everything is automated and convenient.
Who is in charge of it?
Our logistics specialist whose responsibility is store replenishment. Goods are shipped from our own warehouses and providers of both alcoholic and non-alcoholic beverages.
So far, we have not yet implemented MySales to replenish stores from local suppliers of milk, groceries, and meat products.
What’s the reason?
It is related to the human factor. It does not work yet because a lot of people are involved in planning, and I can see that this is not effective. This year we decided that we will try to combine and adjust the processes for MySales: literally from Monday, a specialist comes to me who will have to centrally place these orders. Yes, there may be errors, since this is a new group of goods for order calculation. But MySales has such a system of predictors that, I think, it will be possible to set everything up correctly. It's probably worth starting with a fireproof stock, since we started last year, and we will gradually release it and trust the system more. And the person who will deal with this, of course, will monitor each delivery and balance.
How do you deal with safety stock?
I will say that now we are consciously overstocking. Previously, it was equal to one unit, that is, 100% of the display of goods in the hall. Now, seeing how the system works, our safety stocks for some items, for example, for strong alcohol, have just recently decreased to 25% of the display in the hall (safety stock was reduced by 75%). For all the other positions, MySales helped us reduce overstock by 50%.
Our assortment is growing, the number of articles is increasing. The warehouse is not limitless, and therefore, with an increase in the number of articles, it is necessary to reduce the stock of existing goods. We started back from last year: safety stock reduction by 25%, that is, the coverage became 75% - and absolutely did not feel this decrease. Now we continue to reduce further and we do not see any losses yet. Ideally, we should give up safety stock entirely and leave forecasting fully to MySales. But here there is some fear of unpredictable sales surges: when a person comes and says: “Give me three boxes of this wine,” and we have literally 12 bottles on the shelves (a box of 12 bottles). Therefore, we are afraid that it will not be enough. But for now, we have enough. The system analyzes, relies on sales of past periods, seasonality, etc. and keeps a certain stock.
Is it difficult to monitor a huge number of SKUs?
Challenging. We have 7,000 articles and 2 stores, but one person handles them. Should the number of stores increase, we still plan to manage it with one person only. The system is highly scalable. In practice, the logistics specialist spends about 2-3 hours a day on order calculations.
The way we structure our work is that at 4 pm we look at sales for today and planned deliveries for tomorrow. That is, at night all this is collected and at 5 am the car is loaded with an order for the distribution center. As a result, in 12 hours we manage to make orders, process them, send them to the warehouse, the warehouse collects and at 6 in the morning the car is already with the goods in the store.
How often do order errors occur?
I’ll tell you a story from yesterday. Warehouse preparing delivery to our Mechnikov contacted us. Pickers visually see that they overstock for certain positions. They looked at recent sales - 4 units per week, and there are 50 units in the warehouse. The question goes to the logistics specialist. “Why?”. The first assumption is a system error. After checking, we determined that we brought all these overstocks deliberately through manual control. Once again, we made sure that there are no system errors in this. Errors occur only when people interfere with the system (he laughs :)) So this is the way it is: if no one interferes with the system forecast, everything is fine. People are interested in creative work, not routine calculations.