DIERBERG'S AUTOMATES ITS ORDERING, FORECASTING

SARAH MULHOLLAND

CHESTERFIELD, Mo. -- Dierberg Markets, a 19-store chain here, is in the process of implementing a fully automated inventory and forecasting system in its bakery, deli and floral operations, officials said.

Robert Sanabria, director of information technology at Dierberg's, said the chain has installed the new system, from Eatec, San Francisco, in the chain's bakery departments. Store officials said the new system has cut down on "short" orders and human errors while saving the retailer money on inventory control.

Dierberg's is installing the same system in its deli operations, Sanabria said.

The system is designed to remove the tedious paper trail behind ordering, purchasing, billing, shipping, receiving and inventory control, Sanabria said.

"Inventory control understates the plans we have for this," Sanabria said. "It is really a production-planning tool with costing."

The system builds an electronic network connecting all the stores to a central commissary where deli and bakery products are produced, packaged and distributed, Sanabria said.

Plans are under way to connect the system to the point-of-sale terminals over the next several weeks, Sanabria added.

Dierberg officials declined to reveal the cost of implementing the electronic ordering and inventory network.

In addition, plans are in the works to install wireless, handheld scanners in stores and at the commissary for inventory purposes.

Once these two elements are in place, the forecasting application will be fully functional, Sanabria explained.

"You need to have an accurate inventory and you need to know how much you sold," Sanabria said. "You need to connect the two of these to close the loop."

Bakery was the first department to go online, Sanabria said. That installation was completed six months ago.

The system's implementation in the deli department is expected to be completed shortly, Sanabria said.

The chain is holding off on installing the system in the floral departments until after the Valentine's Day rush.

All of Dierberg's deli and bakery operations are served from a single commissary.

The Eatec solution is designed not only to keep track of final product, but all the ingredients that go into that product as well, Sanabria explained.

The chain targeted the bakery first because it was a less-complicated installation, Sanabria said.

"We do a lot of prepared foods and there are a lot of sub-recipes, like sauces, in the deli," Sanabria explained. "We decided to start with a more vanilla implementation. A doughnut is a little bit simpler than lasagna."

The process of setting up databases and creating recipes began roughly a year ago.

However, the implementation itself is fairly simple. Connecting the terminals in stores to the database takes about a month, he said.

Store employees use thin-client terminals to access the central database.

The terminals are not full PCs, Sanabria said. They simply provide access to a network by only processing keyboard input and screen output. Employees are quickly adapting, according to Tom Merritt, in-store bakery supervisor for the chain.

Associates at store level appreciate the instant gratification, Merritt said.

For example, short orders are instantly visible and sent over to accounting. Mangers can remedy the credit situation immediately. Previously, accountability was often buried in a pile of paperwork, he explained.

"This really puts the power to do their jobs effectively in their hands," he said. "It closes a lot of avenues for excuses."

Merritt said he has seen a substantial decrease in the cost of human error since the new system was installed.