How did the collaboration with Expertum come to be?
The main reason was our new distribution center in Bleiswijk. At Hoogvliet we want to offer our products to the customer as cheap as possible. We have achieved this with an automated distribution center. Almost the entire flow of goods is handled by robots. From receiving pallets of chocolate sprinkles up to filling a roll container for the supermarket. Everything is fully automated. Predicting the workload through forecasting is therefore very important. Expertum has an enormous amount of knowledge in the field of data science and HANA predictive. Because we don't have a data scientist in-house, we started looking for a partner. That is how we got in touch with Dirk Kemper from Expertum and we discussed the idea in detail.
Why is forecasting so important?
As a supermarket we have to deal with peak loads. This is also the case in our distribution center. It is not possible to set up the center’s capacity for that peak load, because that is simply too expensive. Our idea is to set up the system as efficiently as possible, with an average load. We do this by providing the system with a forecast for the coming days. This gives us a good idea of the workload. For example, the system can already prepare itself with the destacking of pallets and products, so that activities already are prepared for the busy moments. Analyzing this, we knew that it was necessary to start forecasting, in order to be able to lower logistics costs.
How important is collaboration with a partner?
It is important that you have a partner who speaks the same language and knows what he’s talking about in the complex statistical field. Or at least can make the translation. We have also spoken with data scientists in the past and they are super smart people, but they were often unable to bridge the gap between pure data science and what we need as an organization. That was exactly what we were looking for in a partner, and Dirk from Expertum can supply this. The most important thing is that this is a long-term relationship. We work together in an open and pragmatic way.
Have you worked with predictive before?
We have previously worked with SAP Predictive Analytics, the precursor of the current version of predictive based on our bread assortment. It was an extended version of a presales process. We made predictions for a number of bread types. And why bread? It is a perishable product, you know historically what you are selling in a day and you have no stock at the end of the day. Bread is one of Hoogvliet's main point of attention. We also have 'the bread guarantee'. This means that you can get bread until closing time. That’s why we thought we should be able to predict it with this product.
What is your biggest learning point?
When we look back on my first encounter with predictive, the mistake was that we worked too quickly towards the end result. The proof of concept was a success, and in the end the result was achieved. The base was fragile however. How important it is to develop with scaling up to a full production environment in mind, that was my biggest learning point in the predictive field. That is one of the key things we changed in this project. We have to get the basics in order first, before we can branch out to accurately predicting the sales of crates of beer, for example.
And what about 'getting the basics in order'?
That is also my role in this project. To stay on top of it all the time. I don't mind if the results don't come out right away and if there isn't a 100% correct prediction yet. As long as the basics are right. It must be able to scale, it must be robust and errors must be caught. And what should we do to make it better. Getting the basics right, just takes a lot of time. As with the bread itself, the quality of the ingredients ultimately determines the quality of the final product.
About Hoogvliet
Hoogvliet is a Dutch supermarket chain with 71 stores in the Province North Holland, South Holland, Utrecht and Gelderland. The distribution and service center and the central butchery are located in Bleiswijk. In the Hoogvliet bakery, fresh, traditional bread is baked several times a day for all branches. The organization has more than 6,000 employees.
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