Circle K fuels a better forecast

Global convenience store chain drives an accurate global forecast with Connected Planning.
Partner:
Circle K operates a network of over 12,000 convenience stations around the world. Because they were managed using a conglomeration of spreadsheets and ERP solutions, demand and supply forecasting were misaligned and sometimes inaccurate. “People were doing forecasting in silos,” recalls Magnus Tagtstrom, Senior Director of Supply Chain Optimization. With Anaplan, Circle K now has greater collaboration and an accurate, aligned 18-month rolling forecast.
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rolling demand and supply forecast
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visibility into current inventory

Fewer

stock-outs

One of the clear benefits that I see is the forecast accuracy—this has helped us have the right stock level throughout all our sites.

Magnus Tagtstrom,

Senior Director of Supply Chain Optimization

Before Anaplan, Circle K managed its supply and demand planning in a disjointed combination of spreadsheets and enterprise resource planning (ERP) systems. This led to inaccurate forecasting, an unstructured approach to information gathering, and conflicting demand forecasts.

“One of my objectives has been to try to connect the dots in the supply chain,” recalls Magnus Tagtstrom, Senior Director of Supply Chain Optimization. “I think we had good solutions, but people were doing forecasting in silos, so I wanted to connect that planning process end to end.”

Tagtstrom and his team built a connected approach to demand and supply planning with Anaplan for Supply Chain. Implemented together with Anaplan partner Executit (now part of Anaplan Gold Partner Vuealta), the solution enables the team to accurately predict supply and demand down to the individual-station level across Europe. Using intuitive forecasting and scenario-based planning, the planning teams at Circle K now have a dynamic capacity forecast per product and station so they know exactly where and when to send fuel.

The key result is an accurate and dynamic 18-month rolling forecast of current and future stock levels for its European locations. Tagtstrom says, “One of the clear benefits that I see is the forecast accuracy—this has helped us have the right stock level throughout all our sites. That’s money that we have as a buffer in the supply chain now.”

With an accurate view of capacity needs, Circle K can save money by reducing inventory and using resources more efficiently. “We have full visibility of our current inventory levels, as well as forward-looking inventory levels,” Tagtstrom explains. “With Anaplan, we know how much we will sell and when we can distribute it to sites. This has resulted in driving down both distribution costs and working capital.”

Another benefit is increased sales, because an accurate forecast means Circle K has fewer stock-outs. “If there is ever a time when our store has no fuel, the customer might not shop with us the next time,” Tagtstrom explains. “So it’s very important to us to anticipate demand.” Circle K also realizes intangible benefits: confidence (because everyone is working from the same plan and data), less stress, more collaboration, and the ability to make better-informed decisions.

Circle K chose the Anaplan platform for its ability to get up and running quickly with an iterative development process. Other important factors were the platform’s scalability and intuitiveness, which led to high end-user acceptance. The road ahead includes broader usage, more data sources (such as weather data), machine learning integration, and partner views.

I’m Magnus Tagtstrom, and I lead supply chain optimisation in Circle K. We have four to five products and around 2,500 sites. One of my objectives has been to try to connect the dots in the supply chain. I think we had good solutions, but people were doing forecasting in silos, so I wanted to connect that planning end to end. I looked into other point-specific solutions—the requirements from my side was that we need something flexible and we need something quick. Then I came across Anaplan, which for me is like a … I don’t know, I think people use the words “Excel on steroids.”

The approach that we’ve taken to the entire implementation is: I would like a solution that we can maintain in-house. We’ve trained model builders in my team to develop this in the future. But we were not used to Anaplan, and we were not used to quick development—and we were not really used to what you could do with it. So therefore we chose Executit, which is a local partner here in the Nordics. They’re quick in the development, and they can challenge me. So the solution that we built is replicating a lot of Excel’s, replicating a lot of ERP functionalities. But the nice thing is that we created a connector to the ERP systems, so we get daily updates on volumes and daily updates on sales across the entire field supply chain automatically integrated to the model.

Biodiesel is a big thing in the Nordics. We would like to sell as much as we can, but we have a shortage of it, so we need to allocate it to where our customers need it the most. So taking the Anaplan solution that we have now, it actually automatically had an impact; e.g., what products do we need to supply into our terminals? So I think, for me, that was the kind of, “Okay, when you put the plans in the same place, when you put the known things and when you do allocations, it automatically has an impact on the people doing the shipping plans.”

Some of the clear benefits that I see is the forecast accuracy—being specific in forecasting and then also having the BU inputs to plans into that—I think that will help us to have the right stock level throughout all our sites. That’s money that we have as a buffer in the supply chain now.

So when let’s say [we buy a] product that we got from the Anaplan solution, we have full visibility of our inventory levels and the inventory levels, as well as forward-looking inventory levels, because we know how much we will sell from our demand plans and we know when we can distribute it to sites. This makes us much more specific in being able to drive down both distribution costs and working capital. So what we utilized is taking analytics, in our case power BI on top of Anaplan, to be able to create a much better report to get the insights. With Anaplan, I think we have taken this low-tech industry into something more high tech, and we’re ready for the future.

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