Data Synchronization Improves Supply Chain for Wegmans

A new report argues that investing in accurate "global data synchronization" (GDS) brings improved supply chain efficiency, cost savings and increased revenue to consumer packaged goods and retail companies. The study was released by the Accenture consulting company, the Food Marketing Institute (FMI), the Grocery Manufacturers Association (GMA), Wegmans Food Markets and 1SYNC. It is based on a study of Wegmans Food Markets and seven suppliers: The Coca-Cola Company, General Mills, The Hershey Company, The J.M. Smucker Company, Nestle, PepsiCo, Inc., and The Procter & Gamble Company.

"The main messages from this study are compelling," said Marianne Timmons, v.p. of supply chain, Wegmans Food Markets. "We have realized many quantifiable benefits from accurate data synchronization. Further, it is foundational to next generation business processes for Wegmans and our trading partners."

GMA's vice president of supply chain and technology Pamela Stegeman added, "When accurate data is synchronized between trading partners and used by all parts of both organizations, we can better meet consumers' needs."

The benefits of global data synchronization documented by the study included:

· Improved accuracy of product weights and measures. One supplier corrected a weight error on a single item and saved $2.2 million in annual transportation costs. Improved accuracy of product weights and measures. One supplier corrected a weight error on a single item and saved $2.2 million in annual transportation costs.
· Improved logistics and distribution efficiencies. Wegmans was able to eliminate $1 million of labor and inventory carrying costs from its distribution network.
· Expediting direct store delivery check-ins at the store level. Wegmans estimated a 7% increase in productivity by reducing direct store delivery check-in times.
· Synchronizing data with trading partners. One supplier improved productivity by an estimated 59,000 hours annually by reducing inspection time by five minutes per order.
· Improving flow of new product information between manufacturers and retailers. A manufacturer reduced its speed-to-shelf for new items from eight weeks down to two weeks.
· Improvements in customer service. Synchronizing coupon family codes helped Wegmans reduce customer coupon scanning rejections by 40%.

Methodology: In March and April of 2006, researchers interviewed more than 120 personnel in departments such as sales, customer service, logistics and accounting at Wegmans Food Markets and seven suppliers. Copies of the report are available from GMA (www.gmabrands.com/publications/index.cfm).

Wegmans Food Markets, Inc. (www.wegmans.com) is a 71-store supermarket chain with stores in New York, Pennsylvania, New Jersey, Virginia, and Maryland. The family-owned company, founded in 1916, is recognized as an industry leader and innovator. Wegmans has been named one of the '100 Best Companies to Work For' by Fortune magazine for the nine consecutive years. In 2006 Wegmans ranked #2 on the list.

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