Popcorn, Indiana Achieves Forecast Accuracy Success

Popcorn, Indiana, LLC participates in one of the most diverse and highly competitive trade-driven categories in the Consumer Goods industry -- salty snacks. With its Popcorn, Indiana^® product line and new Chip’ins^® product line of popcorn chips, Popcorn, Indiana sells a large percentage of its volume through trade promotions -- a critical line item and significant expense on the company’s P&L. Frustration with the time spent (and lost) on essential business tasks, such as clearing deductions, sales and spend forecasting and the difficulty in accurately accruing trade spend, fueled the financial-driven decision to adopt a Trade Promotion Management (TPM) solution from TradeInsight. 

 

Just 60 days after implementation, the company’s deduction balance dropped by more than 50 percent. According to John Kittle, Director of Business Planning and Insight at Popcorn, Indiana, executive level support from the CEO and CFO, along with an internal implementation team representing various departments, enabled the company to derive value from the TPM system quickly.

 

With the new solution, it no longer takes salty snacks manufacturers weeks to analyze and clear a customer-claimed deduction because the manufacturer has all its contracts and status changes loaded, stored and organized into the application. Popcorn, Indiana’s newfound transparency into retailer fines, fees and late charges allows the company to track and manage the “nuisance fees” affecting its trade budget more quickly and accurately. In addition, using a better technology tool gives the finance team at Popcorn, Indiana the ability to more easily establish accruals to fund future deductions and deliver more accurate spend versus objectives reports to the senior management team.

 

Perhaps most impressively, Popcorn, Indiana has increased significantly its accuracy in both sales and spend forecasts. After utilizing the TradeInsight tool for eight months, Popcorn, Indiana’s mean absolute percentage error (MAPE), which is a measurement of forecast accuracy, was nearly cut in half.

 

“Utilizing Excel^® as a planning tool works great, but the minute you ship the first case it’s not a plan anymore,” says Kittle. “There is not a reasonable method that I’m aware of to keep spreadsheets updated and accurate in a timely fashion. In the end, it’s the execution and payment for a trade program that suffers.”

 

Popcorn, Indiana is leveraging the benefits of the TradeInsight TPM solution to identify and address ways to increase the overall effectiveness of its trade budget. Kittle attributes the system for productivity gains and savings, not only in dollars, but in resources and time, across various departments in the entire organization.

 

“The tool’s forecasting capabilities allows Popcorn, Indiana’s operations team to plan production better.  Our purchasing team can review long term forecasts to secure raw materials and logistics can schedule transportation needs to support extra volume during a promotion.”

 

TradeInsight helped Popcorn, Indiana: