The anatomy of a world-class wholesale organisation

Based on our work with clients; analysis of the wholesale and distribution sector; and input from expert consultants; we’ve identified the characteristics that define world-class wholesale organisations. This set of capabilities forms an anatomy that sets apart those businesses who are best placed to succeed as we move forward from the turbulence of 2020.

S&OP

We have formulated a model for potential, based on what we see as the strongest indicators of organisational health across 6 key areas. Strength in each of the elements gives an organisation both resilience (to absorb and manage market and economic pressures) and strength (to outpace/out-manoeuvre competition and act on opportunity).

The second area to look at is the use of advanced forecasting.

A vision of the future

Forecasting cannot be carried out using a one-size-fits-all method. Optimal decision making requires a detailed approach, considering input across all aspects of historical performance; known trends; and detailed awareness of products, supplier and customers. Creating an accurate view of the future relies on applying appropriate forecasting methodologies at individual SKU level and being able to do so quickly and accurately.

There is the potential for huge positive financial impact through minimising inventory and freeing up working capital. Being able to adapt quickly to new dynamics and effectively use the emerging picture to drive decision making also creates compound benefits thanks to the increased ability to maintain proactive relationships with suppliers and customers.

Key characteristics

Within each area of the anatomy of a world-class wholesale organisation, we have outlined a series of defining characteristics. When discussing advanced forecasting, these traits are as follows:

Forecasting demand: Our forecasting tools and methodologies enable us to manage fluctuating patterns of demand across our client base with great accuracy.

Considering the current global scenario, managing rapidly changing dynamics is essential.  The strongest firms are able to do so with precision.

Forecasting safety stock: Our forecasting tool can automatically measure forecast accuracy and apply safety stock requirements accordingly.

Forecasting at a basic level is one thing, using the insight to manage stock levels is what makes the difference. Being able to optimise safety stock levels to changing patterns of demand – at individual product level – creates significant benefit.

Forecasting at all levels: Our forecasting tool allows us to amend forecasts at different levels of the business – bottom-up, middle-out, top-down – enabling us to achieve greater alignment, control and consistency.

It’s not just historical patterns that determine what will happen in the future. Insights are gathered through relationships and knowledge at all levels and fed into the wider picture. Being able to collect, interpret and harness these insights places world-class organisations at a considerable advantage.

Why it makes the difference

Everybody forecasts. The organisations that set themselves apart are those which are able to use the process to deal with the challenges created by:

  • The volume of different products
  • The patterns of demand at product level across different retail clients
  • The complexities of sourcing and stocking the right products at the right price in the right volumes.

Businesses that are able to align decisions around advanced forecasting are better able to manage emerging trends, identify opportunities and act to mitigate risk and vulnerability.

In our experience, it’s difficult for organisations to self-diagnose the key areas where change would have the biggest impact. The diagnostic tool we have created gives you the opportunity to pinpoint priority areas for attention, highlighting specific activities to help you enhance business performance and resilience.

What is the strength and resilience of your organisation? Try our self-assessment tool today.