In the food industry today, it’s eat or be eaten. To survive, midsize food manufacturers and distributors must quickly respond to changing consumer preferences, gain control over inventory, ensure government regulatory compliance, and track the success of promotions. But manual processes and dated, disparate systems make that difficult, leaving consumer packaged goods (CPG) companies hungry for new solutions to automate and integrate critical business processes.
That’s why itelligence, a global SAP consulting company and one of the world’s largest SAP Business Partners, introduced it.CPG, a qualified mySAP All-in-One solution for midsize companies in the food and bakery industry. As a pre-configured mySAP All-in-One solution, it.CPG incorporates industry best practices for sales order fulfillment, procurement, process manufacturing and quality control, and integrates business process flows across these key functions.
it.CPG supports industry-specific processes – from managing channel promotions and monitoring food safety to supporting market-driven commodities and the distribution of date-sensitive products. Additionally, it.CPG vertically integrates the supply chain – from livestock procurement and slaughter operations to processing and packaging plants – while supporting both net and catch weight products. Catch weight support is an example of CPG-specific capabilities that elevate it.CPG to the level of a true industry solution.
Further, since cost and complexity are always a barrier for midmarket companies, itelligence provides customers with the implementation, training, documentation and on-going support that help ensure a rapid and successful deployment in as little as 16 weeks.
Steve Niesman, President and CEO of itelligence, Inc. summarizes the it.CPG value proposition well. “it.CPG provides midmarket companies with a turnkey solution tailored to their unique needs for industry-focused functionality and business process automation. Based on best practices right out of the box, customers get a world-class solution at an affordable price and a reduced implementation timeline.”
Integrated solution feeds the bottom line
it.CPG integrates forecasting and actual sales information with manufacturing and procurement data to provide production planners and purchasing managers with a real-time view of actual customer demand at the brand, SKU and account level.
Empowered with this business visibility, companies can take action that really impacts the bottom line. They can adjust procurement and production to suit changes in consumer tastes and ensure the right products reach store shelves at the right time. This is especially important in the food industry, where perishable items demand quick action to protect investments.
Companies will also benefit from the commodity-oriented costing features within it.CPG. When it comes to livestock, procurement prices vary daily. To determine the true value of inventory, those prices need to be adjusted, depending upon the yield from each animal during slaughter and the quality of that yield.
To ensure profitability, it.CPG reevaluates procurement cost based on those variables. Capturing this data also enables companies to adhere to government regulatory reporting requirements, which call for tracking of the product value chain from raw ingredients to consumable products.
Measuring promotional impact
Determining the profitability of each event or promotion is easy with it.CPG. The solution tracks all promotional aspects, from planning to execution, revealing critical knowledge, such as promotional patterns. it.CPG also offers industry-specific pricing elements such as re-distribution discounts, cents-off discounts and buy-one-get-one offers.
Pre-configured and integrated deduction management functionality provides a way to create, track and organize accounts receivable documents and accounts online. This frees users from generating extra paperwork and dramatically reduces the amount of labor required.
Process-oriented manufacturing in the mix
Ensuring the safe manufacture of consumable products and making the most effective use of resources requires raw ingredients quantities and relationships, process controls and quality assurance to be integrated seamlessly.
it.CPG can help by automating recipe management. The solution controls the creation and maintenance of product formulations, the incorporation of quality specifications and the analysis of resource options, along with clear documentation of process steps and related instructions. This ensures consistent manufacturing processes and product quality, while incorporating effective planning and costing of process co-products and by-products.
Further, unlike other solutions on the market, it.CPG supports industry catch weight requirements throughout the order fulfillment cycle by providing dynamic relationships between two units of measure (i.e. cases to pounds). As a result, food products can be packaged, ordered, and shipped in cases, yet promoted and invoiced to channel partners in pounds.
it.CPG also improves customer service through the use of bar-coded license plates for shipping containers/pallets. Each shipping container/pallet label provides detailed information for each SKU, along with their related lot control information, with a single read from a Radio Frequency (RF) device – allowing for seamless migration to Radio Frequency Identification (RFID), a rapidly emerging requirement in the food industry.
Inventory control baked in
Food companies must balance inventory levels, making sure they’re high enough to satisfy customer demand, but not so high they become a drag on profit. it.CPG makes inventory levels visible across the supply chain, from production plants to distribution centers to co-packer locations. Vendors, suppliers and customers can send their data in real-time throughout the system. This real-time visibility results in optimized inventory levels and improved customer delivery service.
A formula for compliance
Due to the huge variety of products in the food industry, it.CPG offers multiple scenarios to ensure production complies with government regulations. These include process-oriented production with in-process and post-process quality management, as well as handling unit management. Procurement scenarios include quality management for raw materials and ingredients. Inspections can be triggered after products are picked to provide customers with quality certificates.
SAP and itelligence: A recipe for success
Notables such as Gold Medal, Barber Foods and Johnsonville Sausage have all taken advantage of itelligence’s CPG solution. In the future, itelligence will expand its industry scope to include solutions for midmarket companies in the candy, confections and dairy businesses. Additional functionality will tighten the integration between value chain partners via wireless devices and the web.
Niesman says itelligence will continue to build on its strategic alignment with SAP’s industry-focused software development organization. “We’re committed to leveraging SAP’s best practice models for CPG to provide customers with a rapid, cost-effective foundation for growth that delivers long-term value and flexibility to meet continuous process improvement objectives,” says Niesman.
Customers will also benefit from SAP’s market leadership. “When it comes to software innovation to meet industry requirements, SAP is the leader,” he continues. “When it comes to longevity, SAP is the safe harbor – there’s no question that the financial viability and strength of SAP is critical to midmarket companies.”