The problem

Effective forecasting is a critical task for any food processing business. Unfortunately, it is made difficult by short product life and last minute order changes.

To effectively meet demand, management need to ensure that they have enough raw materials, packaging and labour resources. This can only be achieved if they are able to accurately predict upcoming orders.

Inaccurate forecasting means that buyers will either purchase too much raw material, or not enough. Both situations can cause serious problems for food processing businesses. For example: if processors overstock raw materials, they have to freeze any surplus. This significantly reduces sales price and increases storage costs.

Similarly, failing to order enough raw material forces buyers to make last minute purchases. They cannot negotiate the best prices and if stock shortages are left to escalate, processors may fail to meet orders on time. This damages customer relationships, which can be particularly problematic in such a competitive industry.

The solution

Integreater® from SI Food Software systematically predicts demand based on sales data, which is continuously measured to ensure the most accurate forecasting.

The e-MES will take into account the effects of promotional activity and cannibalisation. For example: if sirloin steaks are on promotion, Integreater® will automatically predict the impact that this will have on sales of rump steak.

The result

Effective forecasting means that buyers are able to make informed purchases several weeks before customer orders are finalised. They can then negotiate the best price for raw materials.

Similarly, operations staff are able to achieve the most efficient use of resources, minimise waste and ensure that orders are met on time.

Download Forecasting factsheet