S&OP journey

March 2010

agenda

• a little bit about innocent

• life before S&OP

• new ways of working

• outcome

• Q&A

3

Innocent started as a group of three friends in 1999, with one idea…

the beginnings

Make life a little bit better, and a little bit easier

4

This revolutionary thinking led us to our first idea…

a tale of two ideas

The amazing electric bath

5

our first range

Fortunately our second idea had more merits

from small acorns

We started small

our product family

and we now have a little family of chilled drinks and veg pots

8

We’ve grew very rapidly up until 2007, and after a tough 2008, have returned to strong growth.

our sales

0

20

40

60

80

100

120

140

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

Revenue (£M)

agenda

• a little bit about innocent

• life before S&OP

• new ways of working

• outcome

• Q&A

10

Our supply chain is built on a 3rd party modular basis with very different forecasting requirements

context – supply chain

growers blender manufacturers warehouses

packagingsuppliers

customers

store

Supply team:Horizon: 6

weeksUnit: Cases

Buckets: Daily

Fruit buys: Horizon: 18months

Unit: tonnesBuckets: annual

Demand team: Horizon: 12 months

Unit: RevenueBuckets: Monthly

old innocent solution

We used to manage short term supply, demand and fruit buys through 3 detached processes:

Supply Team

£ ?Excel tracker in revenue & GM

Access database in cases & pallets

Excel tracker in tonnes & kg

Demand Team Fruit buys

agenda

• a little bit about innocent

• life before S&OP

• new ways of working

• outcome

• Q&A

project approach

Our solution-design was based on the optimum structure for people, process and IT systems, and their interaction.

system

people

process

people

project approach

With the people approach agreed in principle we moved on to the process

system

people

process

key parts of the process

In designing our new process, we worked through what & how we would forecast

£Both Detailed level across

4 dimensions:

4. Breakdown2. Time

3. Geography1. Product

£s or Cases Resolution Horizon Frequency

18 months Monthly cycle

Weekly light-touch

Process overview

This thinking has developed, and whilst our process has been iterative, our current operation is below:

1. Inputs

Updates to forecast collated and signed-off by senior team

2. Forecasting

Commercial team adjust forecast accordingly

3a.Demand review

Sign-off of updated forecast

3b.Supply review

Capacity implications

3c.Fruit review

Impact on fruit contracts understood

4. S&OP meeting

Summary of performance against KPIs

Key decisions made (escalation from prior steps)

Process overview

We also have the ability to escalate to the Board if we need to, and have a weekly process to support this monthly set-up

1. Inputs 2.

Forecasting

3a.Demand review

3b.Supply review

3c.Fruit review

4. S&OP meeting

Board

project approach

With a good understanding of the organisation and required process we began work on finding the best IT solution to support us

system

people

process

making the decision

The main driver of the decision was finding a system that could incorporate financial complexity with daily forecasting

volume revenue revenue (inc. promos)

contributionpotential suppliers

financial complexity

forecast type

the innocent systems world

ERP CRM

inte

rfac

e interface

LOGs Calculator

On top of the Demantra installation we also developed a data hub to hold our master data

innocent data hub

inte

rfac

e interfacein

terf

ace interface

inte

rfac

e interface

forecast breakdown

In order to leverage our financial forecast it was essential for us to be able to break down the forecast into constituent parts

commercial

base forecast

customer investment

media

promo

marketing

event breakdown

Financials (£/€)

final forecast

base forecast

scenario planning

The other big driver for us was to be able to financially evaluate a range of scenarios

base forecast

Financials (£/€)

base Live Scenario 1 Scenario 2

3 pillars

3 different elements required for complete solution

system

people

process

agenda

• a little bit about innocent

• life before S&OP

• new ways of working

• outcome

• Q&A

outcome

We’ve come a fair way in 2 years, and now have a stable platform to support business growth and SKU proliferation.

Whilst there’s definitely more to go after, here’s some of the highlights:

Area 2008 2010

Forecast 3 numbers One number for commercial, finance, marketing &the supply chain

Ownership Split Commercial team

Process Not clearly defined Monthly & weekly cycle

System Excel / Access

Oracle Demantra- Daily forecasting- Promotional management- Demand planning

FG waste c. 2% of NR >0.4% of Net Revenue

Fulf i lment 97% >98.5%

Forecast accuracy (3 wk lag)

c. 80% c. 93%

Bias c. 10% 0.2%

agenda

• a little bit about innocent

• life before S&OP

• new ways of working

• outcome

• Q&A