08 April 2014 – An increase in customer satisfaction is one of the benefits being reaped by South African Breweries (SAB), since the company partnered with Imperial Logistics group company InSync Solutions to address challenges in its below-the-line marketing campaigns.
“SAB became aware that some marketing promotions were not having the desired result, and the root causes included insufficient alignment between below-the-line point of sale marketing and above-the-line activities such as national television and radio advertising,”reveals InSync Solutions managing director Niel Cronje.
“Below-the-line and above-the-line‘messages’ must be aligned; they must hit the market at the same time, and carry a uniform and aligned promise to the target audience, to ensure promotional success and the full marketing benefit,”he stresses.
A joint project team from SAB and InSync Solutions was tasked to examine and analyse the challenges and present solutions to SAB’s steering committee.
Problems were identified that started with an aggressive marketing strategy embarked on by SAB in 2009. Cronje elaborates: “At this time, the South African Breweries’ marketing spend grew more than 100 percent in real terms. This had an impact on the promotional supply chain, which remained largely unchanged and was not able to evolve fast enough, in line with the growing marketing campaigns. Some of the challenges that resulted included the late delivery of below-the-line campaign material. Poor visibility of supply chain activities and inventory holding across all parties resulted in excess or sometimes obsolete inventory,” he explains. “One of the main reasons was that the SAB team responsible for below-the-line promotion execution was split across multiple business functions, which was not ideal.”
“The lack of the most up to date warehouse and information management systems also resultedinlow confidence in the available information on hand, and impacted decision making,”he adds.
The solution implemented by SAB and InSync addressed numerous critical elements in the below-the-line supply chain, including people, processes, logistics functions, distribution network and technology. An executive responsible for below-the-line activities was appointed. A new, integrated end-to-end process was designed, while all the logistics functions were redesigned and supported by new technology. Process controls were established, with integrated control points built in across the supply chain, which serve as stage gates, enabling quicker decision making. Two warehouses were consolidated into one fit for purpose new site, supported by 53 regional hubs servicing almost 63 000 licensed outlets nationwide. Technology implementation included the adoption of a new Warehouse Management System.
The impact of this turnaround strategy on SAB’s below-the-line supply chain has included a significant increase in consumer promotion activity and effective spend, Cronje reports. “In the latest fiscal year, more than 523 000 below-the-line promotion kits were delivered in almost 70 000 shipments. Inventory holding has been reduced, and inventory stock accuracy is now up to 99,9 percent. Order fulfilment has increased by more than 84 percent, while production throughput has doubled and operational expenditure has decreased.
“One of the most significant non-quantifiable outcomes achieved through this partnership betweenInSync Solutions and SAB is improved customer satisfaction,”Cronje concludes.
InSync Solutions is part of Imperial Logistics group company Resolve.