INDIAN WELLS, Calif. -- Manufacturer implementation of advanced technological tools capable of fueling highly efficient distribution and communications practices will speed up over the next three years.
In areas ranging from installing new software to analyze sales and profits more precisely to taking greater advantage of electronic data interchange transaction sets, suppliers are on a fast track to harnessing the power of information technology, according to the preliminary findings of a national survey sponsored by the Grocery Manufacturers of America, Washington, and conducted by EDS, Plano, Texas, and A.T. Kearney, Chicago. The survey results, released at the GMA Information Systems and Logistics/Distribution conference here last month, underscore the changing nature of food industry practices and the perceived opportunities inherent in technological solutions.
Among the highlights of the survey, which is conducted every three years and which drew responses from 63 GMA member companies:
· Efficient Replenishment Tools: The percentage of suppliers rolling out tools for implementing or expanding the scope of continuous replenishment programs will soar in the next three years.
While 67% of manufacturers have a system in place for forecasting distribution center demand today, another 26% said they plan to install such a system within the next three years.
In terms of warehouse inventory tracking programs,
79% of survey respondents said they now have a system in place, with all the remaining 21% planning to implement a program by 1999. The biggest jumps in use of efficient replenishment tools, though, involved advance ship notices, scanned recording of receipts and shipment and cross-docking. Only 44% of suppliers, for example, said they now use advance ship notices vs. 49% who said they will begin taking advantage of the practice within three years.
In the area of scanning of receipts and shipments, 23% do so today, and 61% plan to implement a system by 1999. In addition, 22% of suppliers now engage in cross-docking, while 39% expect to in the future.
· Advancing Category Management: Manufacturers plan to invest heavily in installing systems and leveraging software programs to take advantage of category management opportunities, according to the survey.
While 58% of respondents said they now have a category management system in place for forecasting volume, another 39% plan to implement such a program within the next three years.
In terms of analyzing product sales trends, 67% of suppliers have a software program up and running today and another 22% expect to install one in the future. A substantial jump in the percentage of suppliers using or planning to use trade promotion analysis tools was also reported, from 60% to 87% by 1999.
· Sales Force Automation: The survey also revealed an expanded emphasis on sales force automation and availability of advanced product trends and company profile tools.
For example, 52% of manufacturers now have a program to access retail customer profiles, but 41% said they plan to implement a system within the next three years.
