Tastykake Improves Forecast Accuracy 47%

  • www.tastykake.com
  • SAP
  • Food/Beverage

Tasty Baking Company manufactures some of America’s best-known and most-loved snack cakes. Since the first Tastykakes were produced in 1914, the company has grown and expanded consistently and now sells to the entire eastern US. Tastykake also pioneered the individually packaged snack cake in the 1930s, a concept which has gained traction and spawned countless imitators in today’s grab-and-go culture.

In 2004, Tastykake was on the verge of a major SAP implementation but still lacked a formal forecasting process. The resulting inaccuracies led to an uneven production schedule and unnecessary overtime costs for bakers and support staff. The sub-optimal forecast also meant that Tastykake lost a significant amount of inventory to spoilage on the warehouse floor. In order to prepare for and enhance SAP, Tastykake sought an SAP-compatible solution that would be easy to use, upgradeable, economical, popular industry-wide, and capable of meeting their customer service goals.

In April 2005, Tastykake chose John Galt’s ForecastX Wizard, which fit their requirements like a glove. The Wizard is fully SAP-compatible through its Excel-based architecture and produces the world’s most accurate forecasts with only one click. John Galt’s Walk-Drive-Fly methodology meant that as Tastykake’s process grew, John Galt’s software could grow with them. The Wizard led the Institute of Business Forecasting’s market share reports, proving its popularity in the industry. And at only $895 per license, the ForecastX Wizard is the most cost-effective solution for its price.

Tastykake took advantage of Forecast Xpert Training in 2005 as well, which offered a grounding in statistical methods as well as the ForecastX Wizard software. John Galt’s expert staff assisted Tastykake’s forecasters as they created their first forecasts using the Wizard. With the ForecastX Wizard, Tastykake’s forecast accuracy skyrocketed, with their 15% average error dropping to 8%.

The gains in forecast accuracy have allowed Tastykake to shift to a vendor-managed inventory process, allowing those closest to demand to plan for the future. In August 2007, Tastykake implemented John Galt’s new ForecastX Wizard Premium software. With its impressive performance upgrades, including support for multi-level hierarchies and on-fly recalculations, Tastykake is able to move their forecasting process down to the SKU level from the family level and take control of their more difficult SKUs.