Promotions forecasting accuracy was low leading to inventory leftover or stock-out positions for promoted SKUs. Forecast error was measured at 22%-24% in the case of inventory leftover after promotions and there was a 16% chance of stock-out situations during promotions.

Promotions forecasting was a manual, highly labor intensive and specialized function. The client received electronic and manual spreadsheet transmissions detailing upcoming promotions and merchandizing activity from retailers and had to forecast demand for the items on promotion based on past history of similar promotional events and planned merchandize activity.

The primary objective was to redefine the promotions forecasting process and improve forecasting accuracy thereby realizing higher returns. To achieve this, a promotions forecasting product solution needed to be evaluated and implemented. This could utilize category specific demand forecasting models to make promotions forecasts thereby improving forecast accuracy. This, in turn, would eliminate the use of highly error prone, complex and labor intensive manual calculations using traditional Excel based macros.

	Forecast demand for unique promotions every week across all retailers totaling to 20,000 SKUs per week
	Continually adjust forecasts, with attributes (e.g., price, placement etc.) for forecast of 300 to 500 SKUs changing constantly prior to the launch of the promotion
	Improve promotions forecasting accuracy so as to improve customer (retailer) service level
	Reduce inventory leftover by over-forecast of promotions
	Reduce stock-out positions caused by under-forecast of promotions

The client would also expect a significant reduction in leftover inventory which accounts for nearly USD 100 million in inventory investment per week.

Team Wipro, together with the client identified several areas for improving the forecasting process and identified the need to deploy a promotions forecasting solution.

As a first step, Wipro developed a highly focused request for proposal based on technical and business requirements very specific to promotions forecasting. Wipro used its time tested and proven product evaluation methodology to select the promotions forecasting solution.

The benefits of using Wipro's product evaluation methodology were:

Wipro suggested several areas for improving the process of promotions forecasting and introduced the need for implementing a promotions forecasting solution to improve forecasting accuracy

The 'request for proposal' creation time was compressed by over 50% from an industry average of 12-16 weeks to 4 weeks owing to Wipro's past industry experience and reusable product evaluation framework

In-depth industry knowledge of Wipro helped the client arrive at vendor long-lists and subsequent shortlists rapidly.

	Client was able to leverage Wipro's evaluation and implementation experience for similar packaged solutions
	Wipro brought in objectivity in the evaluation of the RFP responses based on ranking and weights
	Wipro assisted in scoring of vendor responses and collating them for comparing and contrasting features offered by various product solutions

Wipro developed a detailed solution recommendation to Steering Committee using SWOT analysis of all vendors