Chinese Water Company Makes Better Inventory Decisions

A Chinese company has figured out how to lead people to water and make them drink.

China-based Nongfu Spring Company Ltd. has implemented software from U.S.-based JDA to forecast demand seasonality with accurate precision and therefore better manage inventory across its supply chain as demand varies.

Founded in 1996, Nongfu Spring is one of China's largest manufacturers of bottled water and beverages. Its brands include Nongfu Spring, Orient Leaves, Shriek and Nongfu Garden. The company is headquartered in Hangzhou.

Previously, Nongfu Spring relied on homegrown technology to forecast demand and manage inventory for its products, many of which have seasonal demand variations. However, these in-house tools reportedly lacked the necessary capabilities to account for product seasonality, as well as consider input from across the supply chain. As a result, the company experienced product shortages during peak season, while carrying excess inventory at other times. Manual planning processes were very time- consuming and inefficient.

Supported by JDA solutions, today Nongfu Spring says it produces a rolling 53-week demand forecast, which is updated weekly with inputs from across the company. This forecast results in rolling daily deployment plans, spanning plants to distribution centers, which guide production. The new, more accurate forecast also supports a rolling 12-month purchasing plan.

Financial terms of the software deal were not announced.

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