Food and hospitality
Demand forecasting that cut a bakery's inventory waste by 30%
A Los Angeles bakery that has served its neighborhood for more than 15 years was losing money to overstock and had little visibility into what different customers wanted.
less inventory waste
revenue growth
more customer visits
Before and after
Baking by habit and throwing out what didn't sell
- 30% less inventory waste
- 25% more customer visits
- 20% revenue growth
The effect
The problem
Baked goods are perishable, and production ran on experience rather than a forecast. Some items were regularly overproduced and thrown out. The bakery also had little insight into which customers bought what, or when, so promotions were general rather than aimed at anyone.
What we built
We brought sales records, customer data and operating figures into one place, then built item-level demand forecasts using sales history, seasonality and local events. The bakery could set production for each item to the demand it expected.
We grouped customers by how and when they bought, and used that to aim promotions at specific groups and time them to the forecast. We also tracked turnover and order fulfillment to find bottlenecks in day-to-day operations, without adding new systems for the staff to learn.
- Sales, customer and operating data in one place
- Item-level forecast from history, seasons and local events
- Production set to expected demand
- Promotions aimed at specific customer groups
What changed
Inventory waste fell by 30%. Targeted promotions brought 25% more customer visits, and revenue grew 20%.
Client name withheld. Figures are rounded and describe the outcome of work delivered by AB Analytics. Reference conversations can be arranged for some engagements.