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For the type of forecasting and control you'll need to optimize inventory and minimize costs, nothing less than hourly scan data will do.
THERE ARE MANY BARRIERS TO success in the implementation of a home meal replacement program. I believe that the key to most of them will lie in an effective information system to support and control the operation
of the department.
Certainly, there is one other key element: The food offered must taste good and look appealing. This goes without saying. The first step for your company is to develop the recipe programs along with the packaging and presentation standards necessary to create an appealing product.
Then the information systems will become the critical component to success, a success measured not merely by fiscal standards-i.e., did you make a profit?-but also by your customers' standards of whether they found the meals they wanted.
In earlier columns I have discussed how scanning data capture must move to a daily level, rather than the historic collection of scan sales for the week. I've also said that daily scan data collection would serve as a litmus test for every food retailer who perceives that he has competitive information systems.
In the specific instance of HMR, scan data collection must be on an hourly basis. Nothing less than sales by hour by day will be acceptable. Although this data may be collected at headquarters for corporate use and archiving, it must be maintained at store level for planning purposes. This file of daily sales by item will grow to encompass 55 weeks of sales. Using this data each store will produce weekly sales forecasts for general sales planning and ordering. Then each day the forecasting system will produce a new sales forecast, which will be done again at least every four hours throughout the day for use in many different ways that I'll be discussing.
The store-level system must have a real time inventory for every item. This book inventory is adjusted by production, receiving and scanner sales. It will have three inventory values: case, cooler and reserved for accepted customer orders.
Each day the store will be required to take a physical inventory by item using a hand-held terminal to scan the case inventory...