Chicken’s voting for bad forecasting and inventory management
This week in the UK, almost two-thirds of KFC remained closed on Monday after the breakdown of a new supply contract for chicken with delivery network DHL, which had promised to set “a new benchmark” for service to the global fast food outlet. So even DHL can get supply chain and inventory optimisation wrong on a huge scale.
By Monday lunchtime, more than 60% KFC’s UK restaurants were shut as “operational issues” at DHL left deliveries of chicken “incomplete or delayed” less than a week after the contract started with DHL.
In one of the worst logistics failures of recent years, KFC said its new delivery partner, DHL, had experienced “a couple of teething problems”, prompting the disruption to restaurants which can only come down to bad forecasting and supply chain management.
DHL who only recently took over the new contract with KFC described their partnership as a “groundbreaking” move that would see DHL “re-write the rule book” and “set a new benchmark for delivering fresh products to KFC in a sustainable way”. It seems that there is no magic formula for supply chain just simple inventory optimisation similar to what we at Intuendi do daily for global clients.
Naturally, customers of the brand, which opened its first branch outside North America in Preston in Lancashire more than 50 years ago, reacted with anger and frustration on social media. “As if KFC have run out of chicken!! One job! They have one job! #shambles” tweeted one customer.
As covered in a previous blog, it is possible to detect lost sales and how to create a clean forecast. You can read about it here.
Or please reach out, and we at Intuendi can do your forecast for you, and that offer does extend to DHL!