VMI At Ocean Spray—A New Chapter

Summary

• VMI has been a key part of sales and distribution strategy since early 1990’s
• Benefits of VMI to both Ocean Spray and retail partners well recognized
• Smooth transition to TrueCommerce Datalliance VMI increases analyst productivity and positions for program growth

TrueCommerce Datalliance VMI Delivers

• VMI analyst productivity increased by 20%
• All VMI partners transitioned in less than 6 months
• Now supporting the nation’s largest grocery retailers across 40 DC’s; 35% of North America sales with VMI

A Straightforward Process

Ocean Spray Cranberries, Inc. (Ocean Spray) is an agricultural cooperative owned by more than 700 Growers (cranberry and grapefruit) throughout the United States, Canada and Chile. Headquartered in Lakeville, Massachusetts, Ocean Spray is the world’s leading producer of cranberry juices, juice drinks and dried cranberries as well as the leader in the grapefruit juice category in North America. Ocean Spray has sales exceeding $2 billion annually and employs over 2,000 people worldwide.

Founded in 1930, the cooperative’s first products were jellied cranberry sauce and original Ocean Spray Cranberry Juice Cocktail. For 85 years, Ocean Spray has endured a long tradition of quality, innovation, and success. Today, Ocean Spray markets hundreds of products, featuring a wide variety of juices and drinks, cranberry sauce, dried fruit and fresh fruit. Some of Ocean Spray’s latest innovation includes PACt cranberry extract water, Classic Iced Teas, Craisins Dried Cranberries Fruit Clusters, and Cranberry Mango juice drinks.

A Long History with VMI

Ocean Spray has been involved with the Vendor Managed Inventory (VMI) initiative since 1993, using one of the industry’s early platforms – IBM’s CRP service – for 19 years before transitioning to TrueCommerce Datalliance in 2014.

Today, Ocean Spray operates VMI programs with several large grocery retailers and wholesalers across North America. Those programs span 40 distribution centers and represent over 35% of Ocean Spray’s North America sales.

Why VMI Is Important

“Ocean Spray considers VMI to be a very important aspect of our sales and distribution strategy,” says Liz Tavares, Senior Manager, Global Customer Operations.

“VMI provides a number of important benefits. First and foremost, it gives us the framework to work closely with our retail partners to maximize sales by improving on-shelf availability – that is critically important to both us and our customers. VMI helps to strengthen our relationships with key customers. It also helps us gain better visibility and insight into promotional demand, improve forecast accuracy and customer alignment, proactively manage distribution gains and losses, recognize potential diverting activity, and reduce unsaleables. Additionally, VMI creates the opportunity for logistical efficiencies such as order handling, transportation and warehousing.”

Ocean Spray’s VMI analysts have diverse responsibilities. “Our Lead Analyst and four Sr. Analysts own the order-to-cash process. So, in addition to order generation, they manage inventory allocation, transportation coordination and deduction management,” says Tavares. “They also own all program metrics, including days of supply/turns, fill rate, on-time delivery, lead time, unsaleables (as % of sales), deductions and truckload/ pallet optimization. They continually collaborate with the customer, as well as our demand planning, supply planning, logistics, sales and trade marketing groups to drive alignment on short term needs and expectations. Our VMI analysts anticipate customer needs and proactively communicate risk to service delivery as well as opportunity for service efficiency.”

Time For a New Generation

Ocean Spray learned about TrueCommerce Datalliance from other CPG companies already using it as their VMI platform. Those companies shared success stories (that they had reduced costs while improving VMI analyst productivity) by moving to TrueCommerce Datalliance VMI. Ocean Spray felt like that was worth looking into and contacted TrueCommerce.

After a demonstration from TrueCommerce Datalliance and a technical review by the Ocean Spray IT department, the company performed a brief pilot with one customer. The Customer Operations team then evaluated TrueCommerce Datalliance vs. their current VMI tool based on a number of key attributes including ease-of-use, navigation, functionality, supplier strategy (i.e. vision for VMI), supplier enhancement process (i.e. was it community-driven), efficiency, ease of reporting, feedback from other manufacturers and the retailers they serve, and support services. Based on that evaluation, the decision was made to transition to TrueCommerce.

Smooth Transition

The transition was done in less than six months from the time a project manager was assigned. Customers were moved to TrueCommerce Datalliance one at a time. “We had no serious issues with the migration, no downtime and no connectivity issues once we went live,” says Tavares. “The training TrueCommerce did for our team was excellent. They understood our business and knew exactly how to apply the new platform’s capabilities to meet our needs. The transition was seamless to both our supply chain and our customers.”

Greatly Improved Productivity

Today, Ocean Spray supports all VMI programs using TrueCommerce Datalliance VMI.

“As expected, we’ve maintained our ‘days of supply’ and ‘out of stocks’ performance across the board,” says Tavares. “The big difference we’ve seen is a 20% increase in analyst productivity, attributed to the ease of navigation of the TrueCommerce Datalliance tool as well as the accessibility of pertinent data to enable informed decision-making. Our VMI analysts now have more time to focus on ways to improve our key metrics, analyze the effectiveness of promotional events (e.g. timing, lift, displays), and drive increased supply chain efficiencies. As we had hoped, we are now in a position where we can pursue expansion of our VMI program to additional partners and locations.”

Summary

Tavares summarizes, saying: “We are very happy with the migration to the TrueCommerce Datalliance service. We have seen measurable improvements in analyst productivity since the 2014 implementation. The TrueCommerce Datalliance platform has enabled us to streamline the inventory replenishment process, allowing analysts to focus more of their time on addressing exceptions, improving processes, and working even more closely with our retail partners.”

“We are very happy with the migration to the Datalliance service. We have seen measurable improvements in analyst productivity since the 2014 implementation. The Datalliance platform has enabled us to streamline the inventory replenishment process, allowing analysts to focus more of their time on addressing exceptions, improving processes, and working even more closely with our retail partners.”

Liz Tavares
Senior Manager
Global Customer Operations