How IBM delivers S’more profitability for Hershey’s Brazil
For many, the name Hershey’s is pretty much synonymous with chocolate. Think of foil-wrapped Hershey's KISSES at holiday time and the famous chocolate, graham cracker and roasted marshmallow S’mores around the campfire in summertime. But as ingrained in the culture as Hershey’s products are in some places, the company nevertheless faces strong competition in many parts of the world—such as Brazil. Hershey’s Brazil, The Hershey Company in Brazil, used advanced planning analytics to drive increased sales in the face of fierce competition from local manufacturers.
The finance team at Hershey’s Brazil was hindered in the market by a lack of detailed knowledge about its customers—primarily food retailers and wholesalers. With only high-level information to work from, the finance team was limited to viewing sales by channel and region. But it wanted to capture customer-specific data, such as profit-and-loss information and local patterns in demand, and then use the insights gained to shape more effective sales strategies.
With those goals in mind, Hershey’s Brazil turned to CTI Global, a local IBM Business Partner. Together, they decided to build a comprehensive, new enterprise planning platform using IBM Cognos TM1. This solution offers the ability to drill down into sales data for profit-and-loss information on more than 2,000 customers in each region and each specific sales channel in Brazil.
Gaining insight and increased profits
Once the system was deployed, the changes were dramatic. With access to up-to-the-minute customer information, Hershey’s Brazil changed its planning calendar, moving from an annual budgeting process to a highly flexible, real-time monthly process. It captured volume driver information, data on product mix, pricing, channel mix variation and more, and used that information to drive sales. And thanks to the insights delivered by Cognos TM1, Hershey’s Brazil was able to identify key value drivers through actuals-versus-forecast budgeting analysis and increase profit margins.
Building on that success, Hershey’s Brazil has big plans for the future. It intends to expand the use of Cognos TM1 to address cash-flow management, costs and sales, and operations planning. It all sounds pretty sweet, if you’ll excuse the pun.
You don’t have to fly to Brazil to hear more about Hershey’s Brazil’s success story. Attend IBM Vision 2016, 9–12 May 2016, in Orlando, Florida, to hear directly from key participants how they carried out this successful implementation. Then, discover s’more about Hershey’s use of Cognos TM1 to radically enhance its forecasting and planning.