The following transcript was created using a combination of automated and human transcription. Please check the audio version before quoting from the transcript.
Interviewer: We are here in this beautiful flagship store of Nespresso here in Milan in this beautiful Liberty Square. Today we talk about an excellent collaboration between ToolsGroup and Nespresso. OK, Monica, let’s start. First of all, tell us something about you and about your role inside Nespresso.
Monica: I’m Monica Pellegrini, I’m the Customer Care and Service Director. I’m in charge of the supply chain, technical and quality department…and as well customer relationships and the quality of the service that we provide to customers.
Interviewer: Ok Simone, let’s start. First of all, who you are and what is your role?
Simone: I’m Simone Zaffuto, the Supply Chain Manager for Nespresso Italy. So responsible for demand and supply planning area, logistics and delivery service
Interviewer: OK Monica, tell us something about the sales organization of Nespresso.
Monica: In Italy, Nespresso operates with a strong omnichannel approach in order to serve our customers with 70 boutiques but as well with e-commerce, app, and as well the call center. Our boutiques network is designed to have innovative spaces to create the extraordinary tasting experience that distinguish our Nespresso coffee but as well to support our sustainability commitment and our reduction of environmental impact.
For example, here at the Flagship store in Milan we have a recycling area where you can return your Nespresso capsules to be recycled but as well you will find the reusage of exhausted materials such as capsules in our furnishings.
Interviewer: When did you realize that you needed an improvement inside your supply chain planning connected with the Nespresso stores?
Monica: The supply chain complexity increased due to the business environment and pushed us to look for an innovate solution that allowed us to decrease complexity increasing efficiency and allowing us to maintain and even improve the service level to our customers.
Interviewer: Simone, what are your greatest supply chain challenges?
Simone: The retail network is continuously growing, and we decided to improve efficiency in workloads and data flows. We decided to review the boutique replenishment process so, trying to integrate the demand and supply areas and working with an end-to-end perspective, trying to increase control and monitoring. The goal was to increase efficiency throughout the value chain without compromising our excellent service level that we want to guarantee to our customers.
Interviewer: And now the evaluation part. Why did you choose ToolsGroup?
Monica: Among the other providers, the ToolsGroup solution was the one fitting most of our needs, because it was having one full solution integrating from the demand module to as well the replenishment passing through the fulfillment, and this was allowing us to have the full value chain covered.
Interviewer: Monica, what do you think about the ToolsGroup approach?
Monica: At the beginning, we agreed with ToolsGroup to the different steps from the design phase to the different phases of the project. But the crucial one was the design phase because is the one that allowed us to customize and make if flexible like we were looking for because to manage our boutique network we were really looking for the flexibility and the dynamic approach.
Interviewer: Simone, how did you automate your decision-making?
Simone: We had the opportunity to increase automation to reach better results and increase efficiency. From the data integration to the order proposal phase, to the replenishment phase through the sales forecasting activity. Based on the forecast and replenishment constraints such as storage capacity, lead time and safety stock, the tool simplifies the activity of order generation for every single point of sales and give us the ability to monitor every single stock level.
In addition, a real-time alerting system alerts us if and where there are out-of-stock risks and this is one of the most important capabilities that the tool has since it gives us the opportunity to reach immediately and meet customer needs.
Interviewer: Can you tell us something about the advantages that you perceived immediately?
Simone: The advantages are many. Increasing demand forecasting accuracy, decrease the risk of out of stock and obsolescence, transport optimization, decrease the risk of human error and increase for sure in efficiency in all the operational tasks.
Interviewer: Simone, and finally something about the impact of this project inside the stores.
Simone: An accurate sales forecast and a lean supply chain allowed us to optimize stock to guarantee product availability in all Nespresso sales channels.