McDonald’s China Feeds Demand-Driven Forecasting with JDA
Well-known for its ‘Golden Arches’ at each of its 2,700 fast food restaurants, McDonald’s China must be able to predict demand and supply changes quickly in order to maintain superior customer service levels. By nature, fast food is intended to be convenient, quick and easy, and McDonald’s China needed to create a demand-driven forecasting model that takes into account supply planning for distribution centers (DC) and store replenishment at all times. That’s why it chose JDA Software, Inc., to improve its restaurant efficiency as part of a more agile supply chain strategy.
McDonald’s China is part of the overall McDonald’s brand. With more than 37,000 restaurants around the world, McDonald’s is the world leader in retail food services, providing high-quality food and services to 69 million customers in more than 100 countries and regions every day. McDonald's entered the Chinese mainland market in 1990 China is McDonald's third largest market in the world, the world's largest franchise market outside the United States, and the fastest growing market in the world. As of May 2018, McDonald’s China has more than 150,000 employees and served more than 1.3 billion customers.
In a short seven-month deployment, McDonald’s China deployed a range of JDA solutions including JDA® Demand, JDA® Fulfillment as well as JDA Services to support the project from end-to-end McDonald’s China implemented in Shanghai market by March and plan to roll out to other markets within this year. With JDA, McDonald’s China can now unlock visibility into forecast, order and inventory through a powerful demand and fulfillment strategy helping it anticipate and respond to the demand changes to supply in real-time.
As one of McDonald’s largest and fastest growing markets, McDonald’s China are always opening new stores. McDonald’s China needed a better way to balance restaurant efficiency while supporting store expansion with a streamlined supply chain planning process that senses and responds to the fluctuations in demand. By deploying JDA, McDonald’s China is already seeing increased forecasting accuracy giving them the quick time-to-value they need, which will translate into customer satisfaction at each store.
Since going live with JDA in December 2018, McDonald’s China has already seen many benefits, including:
• End-to-end supply chain planning: Driven by the same demand signal, performance can now be managed across the whole supply chain weaving in market intelligence from consumers. They also can manage constrained supply situations like food recalls from a single dashboard.
• Restaurant order planning: No longer faced with out-of-stock situations, McDonald’s China has a continuous restaurant order planning process that replenishes automatically across each store while managing stock, transfers, and waste.
• DC supply planning and supplier visibility: With the visibility needed across each DC, McDonald’s China can now collaborate with suppliers to give them a view into production plans and capacity.
McDonald’s China (mcdonalds.com.cn) expects to implement a cognitive analytics solution to enable demand-driven forecasting, with supply planning for its distribution centers (DCs) and for store replenishment planning within two with the goal of providing forecast, order and inventory visibility through its demand and fulfillment process and quickly response to the impact of demand changes to supply.
“We congratulate McDonald’s China on a successful roll-out that has already reaped quick win results across its supply chain, from improved forecast accuracy, to reduced out-of-stocks and increased customer service levels,” said Amit Bagga, president, APAC, JDA. “In a fast-moving environment like the quick service restaurant industry, it is paramount to have a streamlined supply chain strategy that hones in on demand signals constantly. We look forward to supporting McDonald’s as it expands further into China, serving more customers each and every day.”
