Challenges and growth: Blendwell’s journey to improve planning and supply chain management
Blendwell Food Group produces and packs dried fruits and nuts for retailers across Europe. Following an extended period of growth, the Dutch group needed to scale up their existing planning capabilities to keep up with demand and manage an increasingly complex supply chain.
In February 2022, Blendwell contacted Supply Chain Company, a specialized supply chain consulting firm and RELEX implementation partner, to help devise a solution.
The company faced a significant challenge in their planning and S&OP process. Their existing approach relied heavily on manual spreadsheets, resulting in slow and labor-intensive operations. Moreover, the company had limited visibility and speed in their processes.
Transforming Blendwell’s planning and supply chain for efficiency
The initial work with Supply Chain Company highlighted the need for an integrated planning solution. RELEX was an excellent fit for Blendwell’s multiple production facilities, warehouses, and distribution centers.
The company decided to get a core solution up and running, adding more modules at a later stage and when needed. This would also allow the organization to get used to the new system and new ways of working without being overwhelmed.
The team started with the RELEX demand forecasting solution, and an 18-month weekly forecast would soon replace the existing monthly projections in Excel. However, it was the RELEX supply chain optimization capabilities that would have the greatest impact on the business.
The company faced challenges with their ERP system, which did not adequately meet their production planning requirements. As a result, they had to rely on spreadsheets for planning, which proved to be slow and insufficient in providing the necessary support for plant optimization by the planners.
Blendwell’s production includes baking, mixing, and packing – a complex process with constantly shifting bottlenecks. Packaging and raw materials, some with over three months lead times, need strategic sourcing and careful inventory management. On top of this, staffing is notoriously challenging.
The implementation process was overseen by a senior consultant from Supply Chain Company. They worked on modelling Blendwell’s entire supply chain using RELEX. The objective was to enable the planners to generate a comprehensive integrated supply plan that took into account various factors such as material, production, storage, distribution, and labor costs and constraints.
The project proceeded smoothly within a tight schedule and budget, thanks to a strong collaborative effort. The process was highly interactive, and the workshop-based approach proved to be successful for the company.
Enhancing efficiency and effectiveness: Blendwell’s success with supply chain transformation
Just three months after the implementation, the company has observed significant improvements. Forecast accuracy has increased by 5-10%, and customer service levels have also seen a similar improvement of 5-10%. While various factors contributed to these improvements, RELEX played a central role.
Furthermore, the company has witnessed positive trends in waste reduction. Particularly, a downward trend has become noticeable, especially in the case of critical semi-finished products.
Presently, Blendwell has achieved the capability to generate forecasts and fully integrated supply plans with remarkable efficiency. In the past, the process of preparing sales history used to take several days, and once the forecast was established, no changes could be made until the following month. However, the company has now transitioned to an automated system, allowing for real-time adjustments to the forecast as soon as new information becomes available. This dynamic approach has significantly improved their workflow.
The ability to plan and evaluate the entire supply chain, from forecast to production, procurement, and inventory planning, in one integrated system is vital for Blendwell.
Before RELEX, the company’s production and procurement planning relied solely on sales forecasts, without considering the existing inventory. This approach posed the risk of overproduction, particularly when stock was available in other locations. This challenge was particularly significant for products with short shelf lives, like nuts after baking. However, the current process now incorporates all these factors into a single optimization run.
Significant improvements have been made in the Sales & Operations Planning (S&OP) area. Previously, the process heavily relied on spreadsheets, making it less dynamic than desired by the company. The management had aspirations for S&OP to be the driving force behind the business, but it lacked the holistic and forward visibility necessary for effective execution. RELEX has played a crucial role in addressing these challenges.
RELEX is now used to simulate various business scenarios, thanks to assistance from Supply Chain Company. This capability allows the company to assess the potential impact of opportunities and risks, providing valuable insights into sourcing and production capacity. This becomes particularly important given the recent fluctuations in demand and supply chain volatility.
The planners have expressed their satisfaction with the RELEX solution. They now have enhanced visibility into how different supply chain functions interact, resulting in minimal planning lag. This improvement enables them to proactively identify operational issues and potential supply and demand imbalances before they escalate into problems. In the past, they often found themselves firefighting instead of planning, as issues tended to arise unexpectedly. Today, they have the capacity to develop both primary and backup plans, leading to a more strategic approach in their work.
Although the project team continues to refine the planning model and enhance data quality, the project has already achieved significant success. The company’s ability to generate high-quality plans has undergone a substantial improvement, and their increased awareness of supply chain dynamics enables more confident decision-making.