Integración del periférico G27 Logitech Racing Wheel

Company ST imports, markets and distributes alcoholic beverage in Australia. As a distribution

company, Company ST sources products of more than twenty brands from Australia, Austria, the

Dominican Republic, France, Germany, Greece, Iceland, Ireland, Italy, Japan, Latvia, Mexico,

Scotland and Spain. Around forty per cent of the brands are owned by Company ST and the other

sixty per cent are distributed by Company ST via third party contracts. The comprehensive

portfolio helps Company ST achieve the necessary economies of scale and increase its

competitiveness in the market.

Its corporate mission is to ‘build consumer brand equity and profitability through sustainable

growth, differentiation, consumer participation, and employee innovation’. In terms of its supply

chain, Company ST utilises future demand forecasts to determine the level of capacity and

inventory availability and therefore can be described as an organisation with a ‘push’ processes

within its supply chain. Some distinct characteristics of the demand of Company ST has a

significant influence on its demand forecasts

4.2.1 Factors Impacting Demand

First of all, the sales pattern of Company ST is highly seasonal. Summer and holiday periods are

37

hemisphere, the major holidays in Australia fall in the summer. As a consequence, approximately

60 per cent of the sales of Company ST occur in the last quarter of each year. It is therefore

critical for the company to seize the opportunity in this quarter and maximize the profit for the

business.

Secondly, to some extent, the demand of most brands can be predicted by the statistical demand

forecast based on historical demand data, especially the mature brands. The mature brands are

normally iconic in the industry. They have been distributed by Company ST in the market for

years and cannot readily be substituted by different brands. The level and trend of demand for

these brands changes gradually from year to year. However, the seasonality of the demand of

each year is very similar. Therefore, it is possible for the company to generate a statistical

demand forecast based on the historical demand data. Even for those brands which are not so

mature in the market, the forecaster can also predict the seasonality of the demand for each year.

Thirdly, the demand is easily driven by promotional incentives. The Australian alcoholic

beverage industry is dramatically competitive, especially for the brands where the consumer can

easily find a substitute product. Sales incentives like discounted prices, promotions and ‘gift with

purchase’ (GWP) have a remarkable influence on the demand of these brands. Beside, this

industry in Australia is dominated by two major national retail chains - Woolworths and Coles,

who are also the most important customers of Company ST without exception. Any activities

conducted by these two groups have a huge impact on the value chain of Company ST because

they represent more than 40 per cent of its business. The consumers normally choose the

alcoholic products with the best price or some other kind of incentive where any brand loyalty is

absent. It is therefore difficult to predict the demand driven by promotional incentives based on

historical demand because the retailers, especially the national chains, do not always decide the

timing of promotions based on logic or statistical basis. The forecast errors are therefore more

38

Finally, changes in the macroeconomic environment have a substantial impact on the demand of

alcoholic beverage. Around 80 per cent of Company ST products are imported from overseas via

sea freight. Due to this foreign currency exchange rates and fuel costs have a considerable impact

on inventory cost and therefore on the final price. As a consequence, the demand of alcoholic

beverage is also influenced. At the same time, alcoholic beverages are classified as ‘excisable

goods’ in Australia. The excise paid to the government forms a significant part of the cost of the

goods. The sales price will therefore increase in line with any increases in excise rates. In

addition to these factors, both the unemployment rate and interest rate can also have a

considerable influence on the demand of alcoholic beverage drinks in the Australian market.

4.2.2 Forecasting and Planning Process of Company ST

Due to the high value of inventory, high seasonality of demand, and long lead time for its supplier

to deliver the goods, it is vital for Company ST to plan and manage its inventory at optimal levels

in order to achieve its overall goal - maximising company profit. Company ST reviews its sales

forecast and achieves its sales target every month and therefore its requirement planning also

needs to be reviewed on the same periodic basis in order to facilitate achieving their depletion

targets for all SKU’s each month. As a consequence, its inventory is also replenished on a

monthly basis.

The products of Company ST are sourced via two different methods: imported from overseas

suppliers and produced locally from contracted manufacturers. The suppliers of the imported

goods usually need on average two months lead time from receiving the purchase order to

delivering the order; due to long production lead times and sea freight transit times. In relation to

39

manufacturer at least two months prior to the required delivery date due to the long lead times of

some ingredients.

Uncertainty in demand usually causes most of the problems in inventory management. The actual

lead time of the supply chain of Company ST varies from seven to ten weeks. Although the lead

time is moderately long, it can be considered as ‘a certainty’ rather than ‘an uncertainty’ compared

with demand fluctuation. This is due to contractual agreements and Service Level Agreements

(SLA’s) between Company ST and its suppliers. As previously discussed, Company ST uses a

periodic review process to review its inventory requirements. When the reviewing period and

lead time for each product family are considered fixed the average cycle stock changes according

to the change of demand of each period. Besides, safety stock is decided by the accuracy of the

demand forecast. Therefore, demand forecast accuracy is the key to managing the inventory

efficiency of Company ST.

Company ST operates only one distribution centre in Sydney and distributes goods to all areas in

Australia. Five sales teams are located in five different states and territories and responsible for

the sales to their respective customers. There is also an individual sales team focusing on sales to

the two major national chain groups due to the importance of these two groups to Company ST.

The six different sales teams are also responsible for reviewing the sales forecasts for their

respective market segments on a monthly basis. A forecast and planning system called ‘Cognos’

is utilised to consolidate the forecasts from all the sales teams into a single forecast, with the

consolidated forecast becoming the sales target Company ST is trying to achieve every month.

At the same time, the supply chain team utilise a forecasting and planning system called

MerciaLinc to generate a systematic demand forecast based on historical demand data. The

inventory level is also reviewed by MerciaLinc, based on the systematic forecast generated by the

40

forecast reviewing system. As a consequence, the inbound shipments of each brand are also

scheduled to arrive once per month. A ‘certain weeks’ worth’ of safety stock is carried on top of

the average cycle stock for different brands.