Sales and Operations Planning in FMCG for Australian Business

March 1, 2025

Sales and Operations Planning in FMCG for Australian Business

Why S&OP Matters for ANZ FMCG Leaders

In the fast-moving consumer goods (FMCG) industry, where competition is relentless and margins are slim, planning is the difference between thriving and merely surviving. For Australian and New Zealand (ANZ) CEOs and CFOs, Sales and Operations Planning (S&OP) has emerged as a critical tool to navigate this dynamic landscape. At Trace Consultants, we recognise the unique demands of the ANZ market—fluctuating consumer preferences, vast geographic challenges, and global supply chain pressures. This article explores how S&OP can revolutionise FMCG businesses, offering strategic insights to optimise operations, enhance profitability, and align your leadership vision with actionable outcomes.

S&OP is more than a supply chain process; it’s a holistic approach to synchronising sales forecasts with operational capacity. For ANZ FMCG leaders managing diverse product portfolios or expanding regionally, embracing S&OP is essential to staying agile and competitive. Let’s delve into what S&OP entails, its importance in the FMCG sector, and how you can leverage it effectively.

What is Sales and Operations Planning (S&OP)?

Sales and Operations Planning is an integrated process that unites sales, marketing, operations, and finance to create a cohesive business strategy. It aligns demand forecasts with supply chain capabilities, enabling FMCG companies to respond swiftly to market changes while optimising resources. In the ANZ context, where seasonal peaks (like summer beverages or winter snacks) and regional tastes shape demand, S&OP ensures inventory, production, and distribution are in sync.

Unlike fragmented planning methods, S&OP breaks down silos, fostering collaboration across departments. CEOs define the overarching goals, while CFOs ensure financial alignment—together, they drive a process that delivers measurable results. Industry data suggests that businesses with robust S&OP frameworks achieve up to 20% better forecast accuracy and 15% lower inventory costs, outcomes that resonate with ANZ FMCG leaders striving for efficiency.

The FMCG Landscape in ANZ: Opportunities and Challenges

The FMCG sector in Australia and New Zealand is a powerhouse, contributing over AUD $150 billion to the regional economy. Yet, it’s a market fraught with complexities that test even the most seasoned CEOs and CFOs:

Geographic Diversity: Serving urban centres like Melbourne and Wellington alongside rural outposts demands sophisticated logistics.
Shifting Consumer Preferences: Health-conscious ANZ consumers are pushing demand for sustainable, organic, and plant-based goods.
Supply Chain Risks: Global disruptions—think shipping delays or raw material shortages—impact local operations.
Regulatory Demands: Strict food safety and sustainability regulations add layers of complexity.

S&OP tackles these issues by integrating real-time data and predictive tools, empowering leaders to anticipate trends, streamline supply chains, and protect margins. For ANZ businesses, where adaptability is key, S&OP is a vital enabler of success.

The Strategic Role of CEOs and CFOs in S&OP

For ANZ CEOs and CFOs, S&OP is a leadership opportunity. CEOs set the strategic tone, ensuring the process supports long-term objectives like market expansion or product innovation. CFOs, meanwhile, anchor it in financial reality, analysing costs, cash flow, and ROI. Together, you cultivate a culture of accountability and precision.

This dual leadership is critical in FMCG, where decisions ripple across sales, production, and finance. Imagine a scenario where monthly S&OP reviews sharpen demand forecasts, enabling better resource allocation—an outcome that strengthens both operational resilience and financial performance. At Trace Consultants, we’ve witnessed how executive commitment elevates S&OP into a competitive edge.

Key Components of an Effective S&OP Process

A successful S&OP process is structured yet flexible. Here’s how it breaks down for ANZ FMCG businesses:

1. Demand Planning

Forecasting is the foundation of S&OP. In FMCG, where promotional campaigns and seasonal trends dominate, accurate predictions are non-negotiable. Use historical data, market insights, and consumer behaviour analysis to forecast demand across products and regions.

2. Supply Planning

Align production and sourcing with demand. For ANZ firms, this means coordinating manufacturing in key hubs while managing imports for raw materials. S&OP prevents overproduction of perishables or shortages of fast-selling items.

3. Inventory Management

Balancing stock levels is a constant challenge. Too much inventory drains capital; too little risks lost sales. S&OP optimises stock, reducing waste—a priority for FMCG companies handling fresh goods like dairy or bakery items.

4. Financial Integration

CFOs bring rigour here, syncing operational plans with budgets. S&OP offers visibility into revenue forecasts, cost structures, and profitability, enabling informed investment choices.

5. Performance Review

Regular S&OP cycles—monthly or quarterly—keep momentum alive. ANZ leaders should track metrics like forecast accuracy, delivery performance, and inventory turnover to refine the process.

Benefits of S&OP for ANZ FMCG Businesses

S&OP delivers outcomes that matter to CEOs and CFOs:

Enhanced Forecast Accuracy: Minimise overproduction and stockouts, boosting customer trust.
Cost Savings: Streamline inventory and logistics, releasing funds for growth initiatives.
Market Agility: Adapt quickly to competitor actions or demand surges.
Team Alignment: Unite sales, operations, and finance under a shared plan.
Sustainability Gains: Cut waste and emissions, supporting ANZ’s ESG priorities.

These benefits compound over time, transforming operational efficiency into a strategic advantage.

Common S&OP Challenges and How to Overcome Them

Implementation isn’t without obstacles. ANZ FMCG leaders often face:

Data Fragmentation: Disconnected systems obscure insights. Solution: Adopt integrated platforms like SAP or Oracle NetSuite.
Change Resistance: Teams may resist new workflows. Solution: Secure CEO endorsement and educate staff on S&OP’s value.
Forecasting Gaps: Reliance on outdated methods. Solution: Use AI-driven analytics for precision.
Short-Term Mindset: Focusing on daily issues over strategy. Solution: CFOs can tie KPIs to long-term S&OP goals.

Trace Consultants helps clients navigate these hurdles, tailoring solutions to the ANZ market.

Steps to Implement S&OP in Your FMCG Business

Ready to act? Here’s a roadmap for ANZ CEOs and CFOs:

Evaluate Current Processes: Identify gaps in your existing planning approach.
Set Clear Goals: Link S&OP to priorities like efficiency, growth, or resilience.
Assemble a Team: Include leaders from sales, operations, finance, and IT.
Leverage Technology: Deploy tools like Demand Solutions or Kinaxis for integration.
Start Small, Scale Up: Test S&OP in one area, then roll it out broadly.
Review and Adapt: Monitor KPIs and tweak the process as needed.

Partnering with Trace Consultants can streamline this journey, ensuring rapid, lasting impact.

The Future of S&OP in ANZ FMCG

S&OP is evolving with technology and market demands. AI and machine learning will refine forecasting, while sustainability will become a key focus. For ANZ FMCG businesses, adopting these advancements ensures long-term competitiveness. CEOs and CFOs who prioritise S&OP now will lead the pack in years to come.

Master S&OP, Master Your Market

Sales and Operations Planning is a strategic linchpin for ANZ FMCG success. By aligning demand, supply, and finance, it equips CEOs and CFOs to tackle complexity, enhance efficiency, and drive growth. At Trace Consultants, we’re dedicated to empowering Australian and New Zealand businesses. Visit www.traceconsultants.com.au to learn how S&OP can elevate your operations.

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Harnessing Forecasting and Technology to Improve Labour Planning in Australian F&B and Hospitality

By embracing the future of labour planning, Australia's F&B and hospitality businesses can rise above common pitfalls, setting the stage for sustained success and growth.

In the bustling world of Australia's food and beverage (F&B) and hospitality sectors, having the right staff in the right place at the right time isn’t just a mantra; it's essential. Mastering labour planning is paramount to business success, and with the aid of innovative forecasting processes and scheduling technology, it's more achievable than ever.

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1. The Power of Precise Forecasting in Labour Planning

Understanding Demand Patterns: Dive deep into historical data to anticipate busy hours, seasonal variations, and events. This reduces overstaffing during quiet periods and understaffing during rushes.

Budgeting with Precision: By forecasting labour needs, businesses can better allocate resources, resulting in controlled payroll costs and maximised profitability.

Responsive Flexibility: Forecasting allows for real-time adjustments. If unexpected changes arise, such as sudden tourist influxes or local events, businesses can adapt staffing needs swiftly.

2. Embracing Scheduling Technology: The Game Changer

Automated Rostering: Today's scheduling platforms consider staff availability, skill sets, and legal constraints, producing optimal rosters with minimal manual intervention.

Employee Empowerment: Modern scheduling tools often come with features allowing employees to swap shifts, request time off, or indicate availability, leading to greater job satisfaction and reduced turnover.

Insightful Analytics: Beyond mere scheduling, these platforms offer insights into labour costs, productivity metrics, and trends, helping businesses continually refine their labour strategies.

3. The Seamless Integration of Forecasting and Technology

Data-Driven Scheduling: Merging the insights from forecasting with the capabilities of scheduling software ensures rosters are not just efficient but also strategically aligned with business goals.

Continuous Improvement: As businesses consistently use forecasting and scheduling tools, the data collected can help refine future forecasts, creating a virtuous cycle of improvement.

Competitive Advantage: In an industry where margins are tight, mastering labour planning through forecasting and tech can be a distinguishing factor, ensuring customer satisfaction through optimal service while managing costs.

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The Australian F&B and hospitality sectors are marked by dynamic demands and ever-evolving challenges. By harnessing the dual powers of advanced forecasting processes and state-of-the-art scheduling technology, businesses can optimise their labour planning, ensuring they are well-equipped to thrive in this competitive landscape.

With these tools in hand, Aussie businesses can confidently navigate the complexities of labour management, ensuring both staff satisfaction and impeccable customer service.

Contact us today, trace. your supply chain consulting partner.

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September 9, 2024

Achieving Best-in-Class Sales & Operations Planning (S&OP) in Australia & New Zealand Manufacturing

In this article, we explore how manufacturers in Australia and New Zealand can implement or enhance an effective S&OP framework by leveraging critical enablers such as technology, planning capabilities, data-driven KPIs, and strong organisational alignment. Learn how Trace Consultants can guide your S&OP journey.

Achieving Best-in-Class Sales & Operations Planning (S&OP) in Australia & New Zealand Manufacturing

The competitive landscape for manufacturing in Australia and New Zealand is rapidly evolving. In this dynamic environment, operational alignment and agility are essential to success, and Sales & Operations Planning (S&OP) serves as the central nervous system for effective supply chain management. At its core, S&OP ensures that demand, supply, and financial planning are continuously aligned, enabling manufacturers to make informed decisions, reduce costs, and enhance customer satisfaction.

But what separates the best from the rest? Best-in-class S&OP is enabled by a combination of robust technology, advanced planning capabilities, data-driven KPIs, and an organisational structure that fosters collaboration across departments. In this article, we’ll dive deep into the critical enablers of an effective S&OP framework, explore the key outcomes that manufacturers can expect, and outline how organisations can implement or refresh their S&OP process to maximise success.

Key Components of a Best-in-Class S&OP Framework

Portfolio Planning
Portfolio planning is the first step in a successful S&OP process. It involves reviewing the current and future state of the product portfolio to ensure alignment with business goals. This step requires careful consideration of product lifecycle management and market trends, balancing growth opportunities with risk.
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Demand Planning
Accurate demand planning is the foundation for aligning supply with market needs. This process involves forecasting demand by integrating historical data, market intelligence, and sales input to predict future customer requirements. A best-in-class approach uses sophisticated demand sensing tools to refine these forecasts, reducing the risk of overproduction or stockouts.
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Supply Planning
Supply planning follows demand planning and focuses on aligning production capabilities with forecasted demand. Manufacturers must factor in constraints such as production capacity, raw material availability, and lead times. Best-in-class supply planning requires an agile approach, where companies can quickly adjust production plans based on real-time data and unforeseen disruptions.
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Pre-S&OP
This step involves refining the alignment between demand, supply, and financial plans. Pre-S&OP brings together cross-functional teams to resolve discrepancies, balance trade-offs, and finalise a plan that will maximise customer satisfaction while controlling costs.
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Executive S&OP
The executive S&OP step formalises the plan, with senior leadership reviewing and approving the final proposal. This stage ensures that the organisation’s strategic objectives are met and that the plan is financially viable.
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Financial Alignment
Central to the entire process is financial alignment. Every step in S&OP must tie back to financial goals, ensuring that the business remains profitable and sustainable.

Critical Enablers for Effective S&OP

To build a best-in-class S&OP process, manufacturers must invest in several critical enablers that drive success across all planning stages:

Advanced Technology and Tools
Technology is a game-changer in enabling seamless S&OP processes. Cloud-based planning systems and advanced analytics tools enable real-time visibility across the supply chain, enhancing the ability to make informed decisions quickly. Machine learning algorithms can predict market shifts, while automation reduces manual intervention, freeing teams to focus on strategic decision-making. Manufacturers in Australia and New Zealand should consider integrating technologies such as demand sensing, scenario planning, and inventory optimisation tools into their S&OP processes. These technologies not only improve forecast accuracy but also enable better contingency planning for supply chain disruptions.
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Enhanced Planning Capability
S&OP is only as strong as the teams that execute it. Therefore, building internal planning capabilities is crucial. This includes developing competencies in demand forecasting, supply chain optimisation, and financial planning. Regular training and cross-functional collaboration are key to ensuring that planners can effectively leverage data and technology in their decision-making. Manufacturers should foster a culture where planners understand not only their area of expertise but also how their decisions impact other parts of the business. For example, demand planners need to be aware of the constraints in supply planning, while supply planners should understand the financial implications of their decisions.
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KPIs and Data-Driven Insights
Key Performance Indicators (KPIs) are essential for tracking the effectiveness of S&OP. Leading manufacturers use data-driven insights to inform their planning processes and monitor performance against established goals. Common KPIs for S&OP include forecast accuracy, inventory turns, service levels, and lead times. Best-in-class S&OP frameworks use real-time data to adjust plans as needed, ensuring that operational goals align with strategic objectives. Dashboards that track these KPIs provide decision-makers with visibility into performance, allowing for proactive adjustments.
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Organisational Structure and Alignment
S&OP thrives in organisations that break down silos and foster collaboration between functions such as sales, operations, finance, and supply chain. An effective organisational structure for S&OP involves clear roles and responsibilities, with a centralised planning team responsible for coordination and execution. Cross-functional meetings, where data is shared openly, help align the objectives of different departments. Furthermore, ensuring executive buy-in is critical to achieving S&OP success. The C-suite must champion the process, providing strategic direction and ensuring that plans are aligned with long-term business goals.

Implementing or Refreshing Your S&OP Framework

If your organisation is embarking on an S&OP journey or refreshing an existing framework, several steps can ensure a smooth implementation:

Assess Current Capabilities
Before embarking on an S&OP transformation, it’s essential to conduct a thorough assessment of your current capabilities. This includes evaluating technology systems, planning processes, organisational structure, and the skills of your planning team. The goal is to identify gaps and prioritise areas for improvement.
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Set Clear Objectives and Outcomes
Define the outcomes you hope to achieve with S&OP. These objectives should be specific, measurable, and aligned with overall business goals. For example, you might aim to improve forecast accuracy by 10%, reduce stockouts, or optimise working capital by reducing excess inventory.
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Pilot the Process
Piloting the S&OP process on a smaller scale allows organisations to test new approaches and tools before rolling them out across the entire business. Choose a specific product line or market segment as the pilot area, and involve cross-functional teams in the process to ensure buy-in from all stakeholders.
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Leverage Technology
Integrating technology is not a one-time investment. Organisations should continuously evaluate new tools and systems to ensure that they’re leveraging the latest capabilities. Consider implementing advanced planning systems (APS) that offer scenario planning, demand sensing, and real-time analytics.
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Establish a Governance Model
A well-structured governance model ensures that the S&OP process runs smoothly. This includes defining roles and responsibilities, setting meeting cadences, and ensuring that decision-making authority is clear. Governance also extends to ensuring that data is accurate, complete, and available to all stakeholders involved in the S&OP process.

Outcomes of Best-in-Class S&OP

When properly implemented, a best-in-class S&OP framework offers numerous benefits to manufacturing organisations:

Improved Forecast Accuracy: Advanced demand planning tools enhance the accuracy of forecasts, reducing the likelihood of stockouts or overproduction.
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Optimised Inventory Levels: By aligning supply with demand, manufacturers can reduce excess inventory, freeing up working capital while ensuring service levels are maintained.
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Increased Agility: With real-time data and scenario planning, organisations can quickly adapt to changes in demand or supply disruptions, minimising the impact on operations.
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Financial Alignment: Effective S&OP ensures that operational plans are closely aligned with financial objectives, helping organisations meet revenue and profitability goals.
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Enhanced Cross-Functional Collaboration: S&OP fosters collaboration between departments, breaking down silos and ensuring that all functions work towards a common goal.

How Trace Consultants Can Help

At Trace Consultants, we understand that implementing or refreshing an S&OP framework is a complex journey. We offer a comprehensive range of supply chain advisory services to guide organisations through every step of the process. From assessing current capabilities to recommending the latest technology solutions, our team of experts helps businesses in Australia and New Zealand realise the full potential of their S&OP frameworks.

By partnering with Trace Consultants, manufacturers can benefit from:

Tailored Assessments: Our team conducts in-depth assessments of your current S&OP process, identifying gaps and areas for improvement.
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Technology Implementation: We recommend and implement the best technology solutions for demand planning, supply optimisation, and inventory management.
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Planning Capability Development: We work closely with your teams to enhance planning capabilities, ensuring that your organisation can make data-driven decisions at every stage of the S&OP process.
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Continuous Improvement: S&OP is not a static process. We help organisations build a culture of continuous improvement, ensuring that the framework evolves alongside business needs.

For manufacturers in Australia and New Zealand, a well-executed S&OP process is a critical enabler of operational excellence. By leveraging advanced technology, building strong planning capabilities, and fostering cross-functional collaboration, organisations can achieve significant improvements in forecast accuracy, inventory optimisation, and financial performance. Whether you're looking to implement a new S&OP framework or refresh an existing one, Trace Consultants is here to help guide you on the journey to supply chain success.

Is your organisation ready to unlock the full potential of S&OP? Reach out to Trace Consultants today to learn how we can help transform your supply chain operations.

Contact us today, trace. your supply chain and procurement consulting partner.

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May 15, 2023

Boosting Service and Working Capital Performance through S&OP: A Guide for Australian FMCG Companies

Why S&OP is Key for FMCG Companies

In the fast-moving consumer goods (FMCG) industry, managing service levels and working capital performance efficiently is a delicate balancing act. A crucial tool for achieving this balance is Sales and Operations Planning (S&OP), a process that aligns sales, operations, and finance for optimal business performance. In this post, we explore how Australian FMCG companies can leverage S&OP and other supply chain projects to improve service and working capital performance.

To understand why S&OP is so essential for FMCG companies, let's first examine the challenges these businesses face. FMCG companies deal with tight profit margins, fluctuating demand, complex logistics, and increasing competition. To stay competitive, they need to deliver excellent customer service while managing their working capital effectively.

S&OP is a strategic tool that helps companies balance demand and supply, integrate financial planning and operational planning, and align the company's strategic goals with its execution plans. By implementing S&OP, FMCG companies can improve their service levels, reduce stockouts and overstocks, and optimise their working capital.

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How S&OP Improves Service and Working Capital Performance

Here are several ways S&OP and other supply chain projects can enhance service and working capital performance in the Australian FMCG sector:

1. Enhanced Demand Forecasting

S&OP involves a robust demand forecasting process. By accurately predicting customer demand, FMCG companies can ensure they have the right products available at the right time, improving service levels and customer satisfaction. This also reduces the risk of overstocking or understocking, which can tie up working capital unnecessarily.

2. Improved Inventory Management

S&OP allows FMCG companies to optimise their inventory levels. Through efficient inventory management, companies can minimise their capital tied up in stock while ensuring they meet customer demand. This leads to improved working capital performance and better service levels.

3. Streamlined Operations

S&OP aligns sales, operations, and finance, promoting collaboration and communication across departments. This alignment can lead to more efficient operations, lower costs, and faster response times, resulting in improved service levels.

4. Risk Management

S&OP includes risk management strategies, which can help FMCG companies anticipate and prepare for supply chain disruptions. This readiness can improve service levels during challenging times and protect the company's working capital.

Implementing S&OP in FMCG

Implementing S&OP in an FMCG company involves several steps, including setting up a cross-functional S&OP team, defining the S&OP process, implementing a supporting technology system, and regularly reviewing and adjusting the S&OP plan.

Successful S&OP implementation requires commitment from the top management, as well as participation from all levels of the organisation. The process should be customer-focused, flexible, and driven by accurate data.

In the competitive Australian FMCG landscape, optimising service levels and working capital performance is key to success. By implementing S&OP and other supply chain projects, FMCG companies can align their operations, manage their inventory more effectively, and forecast demand more accurately.

The journey towards effective S&OP is a strategic investment that requires time and commitment. However, the rewards - improved service, optimised working capital, and a more resilient business - make it a worthwhile endeavour for Australian FMCG companies.

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Contact us today, trace. your supply chain consulting partner.