Premium Food Producer
The client is a producer and marketer of a wide range of premium-branded food products.
The Challenge
The client had a desire to develop an automated tool that would assist in understanding the total economic cost of doing business with its major trade customers, as well as the profitability of each of its brands.
At the time the solution was implemented, the company was losing more than $1.1 million per year by producing custom display-ready pallets that were used less than a third of the time. The company was also losing more than $300,000 per year in minimum balance write-offs through a customer that consistently shorted invoices. through one customer that consistently took advantage of this invoice policy.
Capgemini Approach
To aid in understanding the profitability of its trade customers, the client’s brand metrics were broken down into categorical activities: Distribution/Logistics, Manufacturing, Sales/Marketing, Administration/Support, Finance, Order Management, Overhead, Unsaleables.
Phase 1 of the solution consisted of developing a Customer P&L for four major pilot customers to demonstrate the business value of the information. This phase involved the manual collection of data and input into CGEY’s Customer Profitability Analysis Accelerator Tool.
Phase 2 included the development of an automated and integrated solution that provides “ Customer Profitability” and “Brand Profitability by Customer” analysis through a company portal. This phase called for the development of a monthly, automated ETL (Extract Transform and Load) process, a new subject area to the client’s Data Warehouse environment, and the definition of a reconciliation process to ensure data integrity.
Value Delivered
Automating the ETL process uncovered many opportunities for business process improvements that will lead to higher quality data and more accurate cost-tracking and reporting.