Rising To The Occasion

Tasting Baking Company, best known for its Tastykake brand products, is turning to Eleven's new Direct Store Delivery (DSD) handheld solution to drive route sales and prevent stales and out-of-stocks. Founded in 1914 and headquartered in Philadelphia, Tasty Baking is one of the country's leading bakers of snack cakes and pies. It currently has around 500 independent sales distributors (SDs) in the mid-Atlantic region and Ohio, with plans to expand its distribution nationally. Its biggest customer is Wal-Mart, accounting for 15 percent of sales -- a retailer that is leading many of its suppliers into data synchronization. According to Senior VP and Chief Marketing Officer Vince Melchiorre, "We were looking beyond simple replacement of our current system. We think Eleven's focus on sales forecasting and its tight integration with SAP will allow us to make a quantum leap in how we serve our customers."

Rolling Out Efficiency
Brendan O'Malley, director of enterprise applications at Tasty Baking, says the company is piloting Eleven DSD in December, with plans to roll out in Q1 of 2006, bringing all SDs on board by the end of Q2. "In the last ten years, there is much more complexity in the marketplace, with more product, varieties and configurations, as well as different promotions in different stores, for our SDs to handle," he explains. "Our objectives are to drive route sales and be more efficient and effective in the store, gathering better information."

Eleven DSD's forecasting engine is a key component for ordering the right product and getting it into the stores. Features include location-specific order quantity forecasts, automated scanning and returns processing, and electronic signatures. Suggested order quantities, based on account history, promotions, seasonality and SKU velocity, help improve order accuracy, minimizing inventories and cutting out-of-stocks. Software highlights focus items like promotions and new products, giving them a visual emphasis in the SD's handheld device, like a yield sign for stales. "It also helps SDs to plan in advance, prompting them to talk to this store manager about this special display next week, so they can order the right product and drive the ordering process through the forecasting engine," O'Malley explains. "With better information, better reporting and selling information -- including data capture on the shelf level -- better ordering will help the SDs and ourselves to run our businesses more efficiently."

Tasty Baking is moving from a basic data entry device with very old software, according to O'Malley. "This technology platform has much newer software, with Microsoft's .Net compact framework, and a more technologically efficient device. This is interactive, both gathering and delivering information. It also carries the last six weeks of data for each store. We can do reporting with the last year of data available, and year over year, or quarterly. We can talk to stores about that, and also around stale product," he says.
The Customer Chain
Training is being done through district managers and field sales representatives, starting with the more experienced first rather than going geographically. "We're going to be rolling out in a very piloted way, relatively slowly, and we'll grow from there. We've got to consider the customer chain: the requirements for our customers, the SDs, for our customers' customers, the stores and then the consumer," O'Malley explains. He was part of the vendor selection team, and says they went with Eleven because of their technology platform and references: "They had good thinking about applications that we were trying to do already, especially around functionality like signature capture at the back door, scanning at the product level, i.e. for returns, and shelf tags to help back-up drivers with store info." His advice to other CG firms considering DSD is to be very careful in choosing your partner: "Look for a good product match and a good objectives match, and spend time to get to know them. We have a great synergistic relationship with Eleven."

Getting Data Straight
As with data synchronization, the biggest challenge in what lies ahead will be in getting the data straight from the outset. "The forecasting model is critical, and will take the most time. The complexity of the model relies on getting the right numbers to the guy at the store level," O'Malley says. "We'll be continually testing and shadow piloting that."

For future DSD, O'Malley sees an increasing use of cellular communication: "We'll pilot that later next year for the data -- to send up orders and invoices that much faster, and continuously getting info. and changes and messaging--docking only for power, not to synch up. Some companies are doing it already, to have that info. a little sooner." This trend will increase in the next few years, as cellular prices continue to drop. "You're also going to see more data exchange at the back door between handhelds and store systems, plugging in and synching up electronically with invoices, etc. We're doing manual counting and check in for verification at the back door now," he explains. "The more advanced retailers [like Wal-Mart] are scanning now and synching up with suppliers." As for future automation of the supply chain, there are limits, according to O'Malley: "You probably can't replace the SDs' judgment and knowledge about a particular neighborhood. There's no device that's actually going to deliver the cake. But there will be more data exchange with retailers on shelf-to-register info, with suppliers getting store-scanning info. out the front door and using retail scan data for forecasting and ordering purposes."