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Presented by: Rob Shifter, Nestlé USA, Inc. Jessica Bryner, Rite Aid Corporation.

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Presentation on theme: "Presented by: Rob Shifter, Nestlé USA, Inc. Jessica Bryner, Rite Aid Corporation."— Presentation transcript:

1 Presented by: Rob Shifter, Nestlé USA, Inc. Jessica Bryner, Rite Aid Corporation

2 Components of Collaboration  Sufficient remaining shelf life  Detailed unsaleables data  SKU rationalization  Improved store assortment planning  Effective inventory management  Item discontinuations The Fruit of Our Labor Lessons Learned & Recommendations

3 In most cases, newer is better. Internal initiative at Nestle Avg remaining shelf life – deliveries to Rite Aid Ambient beverage items11-22 months Confections8-12 months Baking ingredients10-27 months Baby food10-15 months Infant formula16 months

4 Without a map, you might be running in the wrong direction. Reporting capabilities  Monthly updates  High level tracking by category  Trend results  Detailed SKU results by a specific retail store

5 Nestle #37812 Returns & Allowance Summary FY09FY10 ABCTotalABC Purchases $x D&O $x D&O% x% Allow Funding $x Shortfall $x

6 Sometimes, things don’t work out like you planned. Review performance as a team Determine the underlying issues causing high unsaleables Take the appropriate actions to remove poor performing items from distribution

7 Don’t use an axe when a scalpel will do the job. Some items do not need to be discontinued in ALL stores Store clusters with the right assortment

8 Butterfinger single ( ) # of stores Sales %TTL D&O %TTL Inventory %TTL% of stores A3,57481%5%73%76% B60313%26%14%13% C5347%70%12%11% Total4,711100% A+B4,17793%30%88%89%

9 We expect people to be productive; inventory should be, too. Inefficient use of company assets Rite Aid internal initiatives  Markdown optimization tool  Tighter controls on inventory flows to the stores  Improved visibility to current inventory levels

10 No self-respecting product wants to end up a banana box. Where should saleable items go? Formal store clearance program & phased markdown guidelines help sell-thru Helps keep food and packaging out of landfills

11 Quarterly meetings to review standardized reports Who attends?  Sales representatives  Category management  Inventory planning  Supply chain What is discussed?  Product assortment  Promotion schedules  Other areas that impact unsaleables

12 D&O $Sales $ FY '09FY '11 % changeFY '09FY '11 % change Confections % % Warehouse and food % %

13 Remaining shelf life  Key metric = # of days remaining at time of delivery Detailed data  Needed to make the best decisions Collaboration task force  Will ensure that the best decisions will be implemented Applicable regardless of returns policy

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