The European manufacturing division of global drinks business Diageo has implemented an automated collaborative replenishment programme with the help of business-to-business marketplace GlobalNetXchange (GNX).
The collaborative replenishment planning process is being introduced initially to three dry goods suppliers covering glass, packaging and label categories. This will give Diageo better access to its partners' production plans, inventory levels and upcoming delivery schedules.
The system is guided by exception alerts generated by GNX. These alerts notify Diageo process owners about projected over or under stock situations, giving them time to take corrective measures before any costs or shortages are incurred.
Diageo projects that the collaborative replenishment process will deliver more accurate replenishment with reduced administrative costs, resulting in lower inventory, reduced logistics costs and better availability.
"Because we see tremendous value in leveraging the strengths of our trading partners, Diageo has made the commitment to integrate collaborative replenishment planning end to end across the supply chain," said Paul Reilly, Diageo Global Supply's collaboration director.
"The plan is to expand this programme beyond the initial three suppliers to more than 50 by the end of 2004, providing a common process for all supply centres and key suppliers. We chose to partner with GNX because they offer a proven, full-service solution plus the expertise required to make the solution fit our unique supply chain processes - with minimal fixed costs and a fast implementation cycle."
Diageo, one of the world's largest drinks businesses, owns a range of brands that includes Smirnoff, Johnnie Walker, Guinness, Baileys and Sterling Vineyards wines. The group trades in over 180 markets around the world.
"We are pleased to welcome Diageo to the GNX community, and look forward to supporting the rollout of this innovative replenishment process to the rest of their strategic supplier base," said Joe Laughlin, chief executive officer of GNX.
"Diageo becomes the first supplier to collaborate with upstream trading partners on the GNX platform, demonstrating the flexibility of the GNX solution and our expertise in designing collaboration programmes to support business processes across the entire retail supply chain."