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Overcoming Q-Commerce Supply Chain Challenges with Kronoscope

By
Niki Khokale
August 30, 2022
5
min
Share this
Blog

Overcoming Q-Commerce Supply Chain Challenges with Kronoscope

Share this

The growing fleets of online grocery delivery companies and their darkstores, has made light speed delivery of fresh supplies the norm today. The players in this space are constantly in the quest to acquire more customers and become market leaders. They entice customers with competitive prices, shorter delivery times, Gen Z branding strategies, personalized pop up messages and refer-a-friend promotions. However, their ultimate success lies in offering high-quality groceries, straight to people’s doors, in less time than it takes to pop to the local corner shop. 

And that doesn't come easy! There's a lot that goes into ensuring operational efficiency at all levels of the supply chain and maintaining optimal inventory levels. 

Let’s understand how Kronoscope has helped one of our clients, a leading Q Commerce startup, to overcome operational difficulties and offer a satisfying customer experience consistently. 

About the client

The client is a 10 minute grocery delivery service that employs a dark store business model. Currently, they have over 40 darkstores at various locations including Mumbai, Delhi, Bengaluru, Gurugram, and Chennai. 

What is a dark store?

Dark stores are distribution outlets that are not open to visitors. These micro warehouses quickly and accurately fulfil orders and thus provide shoppers with resources and options like purchasing products online, same-day delivery, or pickup in-store. The "dark store model" curbs the trivial challenges any delivery service faces, traffic congestions, navigation, and connectivity. 

Business Challenges

  1. Lack of visibility at the darkstore level disrupting timely deliveries
  2. Space Constraints in the dark store model
  3. Poor customer satisfaction due to product unavailability  
  4. Frequent promotions making inventory planning difficult
  5. The need for frequent and timely replenishment due to perishable nature of product

Overcoming these Challenges with Kronoscope

Speedy Deliveries

The key to ensuring on time deliveries is having highly accurate demand forecasts at the most granular levels of the supply chain and having end to end visibility. It is crucial to stay on top of demand trends and fulfill customer needs to sustain in the market. For instance, the demand for meat and eggs on a weekend might be slightly higher than that on weekdays. The demand for certain fruits and vegetables might surge during certain seasons. It is essential to identify these patterns and quickly catch up on them in real time. It’s challenging to plan inventory in an agile manner so as to meet unanticipated demand surges or dips due to factors like even change in weather.

Kronoscope uses the bottom up approach in which the demand is predicted at the most granular levels of the supply chain (i.e) darkstore and then rolled up to the top levels. This enabled them to sense demand signals as close to the customer as possible. Kronoscope offered the client unmatched demand prediction accuracy by leveraging high levels of data granularity to analyze daily demand information at the most granular levels like darkstores. It factored in nine major signals such as historical sales trend, seasonal effect, cyclicity, outlier correction, change in pricing, promotions, weather, similar product and store attributes which are pivotal for shorter shelf life products. This enabled the client to plan their inventory in a way to fulfill orders more quickly and efficiently. Further, having end to end visibility helped them plan inventory proactively and work collaboratively by communicating real time updates.

Dark Store Space Optimization

Though dark stores enable speedy delivery, they have space constraints which requires efficient inventory management. It is crucial to plan inventory in a manner that the available space is utilized judiciously. Further, shorter shelf life of products makes this task complex. Companies often misjudge inventory levels resulting in wastage or even delivery of stale products sometimes. This can affect working capital largely and damage brand reputation. 

Kronoscope, with its inventory control tower, helped the client to proactively identify multiple SKUs across darkstores which have to be liquidated. This prevented inventory pile ups and additional storage costs. Further, it uses the FIFO method to evaluate inventory aging and recommends which stock is to be cleared out first. This helped ensure the delivery of fresh supplies always. Furthermore, the purchase & replenishment plans are created by considering the demand along with the dark store space. For example if your dark store refrigeration storage can stock 50 units for ice cream tubs but your demand shows a requirement of 80 units, the plans would be adjusted to ensure that there is no wastage due to excess quantity.

Product Availability

Convenience is one of the major factors that drives customers to shop for groceries online. Hence, it is important to offer the right product assortment and ensure their availability at all times to gain customer loyalty. However, stock outs are a common theme across the grocery delivery space. It becomes almost inevitable to ensure consistent availability of all SKUs across different locations. Groceries require instant gratification and failure to do so may result in loss of revenue. 

Kronoscope equipped the client with the ability to grab every revenue opportunity with its potential stock out alerts. It helped ascertain current inventory runway, predicted demand for the duration, stock out period and the potential stock out loss. They were able to avoid incurring potential out of stock losses by creating purchase plans for those particular SKUs. With inter store transfers recommendations, they were able to ensure balanced inventory levels and consistent product availability. Further, dynamic safety stock recommendations based on demand variability and service levels came in handy to tackle unexpected stock outs.

Promotional Impact

Grocery delivery businesses are constantly trying to come up with innovative and value adding promotions. As much as it is important to run these promotions regularly, it is equally important to plan inventory to fulfill these promotional uplifts. When customers find that the discounted products are out of stock, it only adds to their disappointment.

The client was able to seamlessly plan inventory for their promotions at any level of the supply chain with Kronoscope. This was done by accurately predicting demand for any events and promotions. They could feed in promotional events with their impact segment, type and duration. This helped the system capture promotional impacts and factor it in to predict demand for future events that are similar.

Frequent and Timely Replenishments

Groceries have shorter shelf life and inventory turns due to which they have to be replenished frequently in a timely manner. This can become a grueling task when there are thousands of SKUs across multiple locations. 

With Kronoscope, the client could save all the effort and time that would go into manually assessing what SKUs are to be replenished at which darkstores and when to replenish them. Users were able to create replenishment plans instantly for different products across multiple darkstores for a selected duration at just the click of a mouse. Kronoscope with its sophisticated AI engine, helped by automatically creating replenishment plans, factoring in current inventory levels and their runway, open orders, inter store transfers and dynamic safety stock levels. This simplified the replenishment process and they could make these plans in real time seamlessly. With its unique feature of truckload optimization, Kronoscope allows its users to ensure that you can maximize your shipment size without any hassle. This leads to reduced transportation spend and higher savings.

It's undebatable that delivery time, products offered/availability, offers & discounts on the products etc. are the key factors that offer customer delight. That being said, with more players setting foot in the grocery delivery space each day, it is ideal to gain a competitive advantage to achieve your business goals. Kronoscope is exactly that, taking a step towards automating the supply chain driven by technologies like AI and ML has never been easier. Gain end to end visibility and enable proactive planning to grow at an exponential pace. At the end of the day one who ticks the high customer satisfaction checkbox is the one who wins. 

Access The Case Study

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Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Blog

Overcoming Q-Commerce Supply Chain Challenges with Kronoscope

Share this

The growing fleets of online grocery delivery companies and their darkstores, has made light speed delivery of fresh supplies the norm today. The players in this space are constantly in the quest to acquire more customers and become market leaders. They entice customers with competitive prices, shorter delivery times, Gen Z branding strategies, personalized pop up messages and refer-a-friend promotions. However, their ultimate success lies in offering high-quality groceries, straight to people’s doors, in less time than it takes to pop to the local corner shop. 

And that doesn't come easy! There's a lot that goes into ensuring operational efficiency at all levels of the supply chain and maintaining optimal inventory levels. 

Let’s understand how Kronoscope has helped one of our clients, a leading Q Commerce startup, to overcome operational difficulties and offer a satisfying customer experience consistently. 

About the client

The client is a 10 minute grocery delivery service that employs a dark store business model. Currently, they have over 40 darkstores at various locations including Mumbai, Delhi, Bengaluru, Gurugram, and Chennai. 

What is a dark store?

Dark stores are distribution outlets that are not open to visitors. These micro warehouses quickly and accurately fulfil orders and thus provide shoppers with resources and options like purchasing products online, same-day delivery, or pickup in-store. The "dark store model" curbs the trivial challenges any delivery service faces, traffic congestions, navigation, and connectivity. 

Business Challenges

  1. Lack of visibility at the darkstore level disrupting timely deliveries
  2. Space Constraints in the dark store model
  3. Poor customer satisfaction due to product unavailability  
  4. Frequent promotions making inventory planning difficult
  5. The need for frequent and timely replenishment due to perishable nature of product

Overcoming these Challenges with Kronoscope

Speedy Deliveries

The key to ensuring on time deliveries is having highly accurate demand forecasts at the most granular levels of the supply chain and having end to end visibility. It is crucial to stay on top of demand trends and fulfill customer needs to sustain in the market. For instance, the demand for meat and eggs on a weekend might be slightly higher than that on weekdays. The demand for certain fruits and vegetables might surge during certain seasons. It is essential to identify these patterns and quickly catch up on them in real time. It’s challenging to plan inventory in an agile manner so as to meet unanticipated demand surges or dips due to factors like even change in weather.

Kronoscope uses the bottom up approach in which the demand is predicted at the most granular levels of the supply chain (i.e) darkstore and then rolled up to the top levels. This enabled them to sense demand signals as close to the customer as possible. Kronoscope offered the client unmatched demand prediction accuracy by leveraging high levels of data granularity to analyze daily demand information at the most granular levels like darkstores. It factored in nine major signals such as historical sales trend, seasonal effect, cyclicity, outlier correction, change in pricing, promotions, weather, similar product and store attributes which are pivotal for shorter shelf life products. This enabled the client to plan their inventory in a way to fulfill orders more quickly and efficiently. Further, having end to end visibility helped them plan inventory proactively and work collaboratively by communicating real time updates.

Dark Store Space Optimization

Though dark stores enable speedy delivery, they have space constraints which requires efficient inventory management. It is crucial to plan inventory in a manner that the available space is utilized judiciously. Further, shorter shelf life of products makes this task complex. Companies often misjudge inventory levels resulting in wastage or even delivery of stale products sometimes. This can affect working capital largely and damage brand reputation. 

Kronoscope, with its inventory control tower, helped the client to proactively identify multiple SKUs across darkstores which have to be liquidated. This prevented inventory pile ups and additional storage costs. Further, it uses the FIFO method to evaluate inventory aging and recommends which stock is to be cleared out first. This helped ensure the delivery of fresh supplies always. Furthermore, the purchase & replenishment plans are created by considering the demand along with the dark store space. For example if your dark store refrigeration storage can stock 50 units for ice cream tubs but your demand shows a requirement of 80 units, the plans would be adjusted to ensure that there is no wastage due to excess quantity.

Product Availability

Convenience is one of the major factors that drives customers to shop for groceries online. Hence, it is important to offer the right product assortment and ensure their availability at all times to gain customer loyalty. However, stock outs are a common theme across the grocery delivery space. It becomes almost inevitable to ensure consistent availability of all SKUs across different locations. Groceries require instant gratification and failure to do so may result in loss of revenue. 

Kronoscope equipped the client with the ability to grab every revenue opportunity with its potential stock out alerts. It helped ascertain current inventory runway, predicted demand for the duration, stock out period and the potential stock out loss. They were able to avoid incurring potential out of stock losses by creating purchase plans for those particular SKUs. With inter store transfers recommendations, they were able to ensure balanced inventory levels and consistent product availability. Further, dynamic safety stock recommendations based on demand variability and service levels came in handy to tackle unexpected stock outs.

Promotional Impact

Grocery delivery businesses are constantly trying to come up with innovative and value adding promotions. As much as it is important to run these promotions regularly, it is equally important to plan inventory to fulfill these promotional uplifts. When customers find that the discounted products are out of stock, it only adds to their disappointment.

The client was able to seamlessly plan inventory for their promotions at any level of the supply chain with Kronoscope. This was done by accurately predicting demand for any events and promotions. They could feed in promotional events with their impact segment, type and duration. This helped the system capture promotional impacts and factor it in to predict demand for future events that are similar.

Frequent and Timely Replenishments

Groceries have shorter shelf life and inventory turns due to which they have to be replenished frequently in a timely manner. This can become a grueling task when there are thousands of SKUs across multiple locations. 

With Kronoscope, the client could save all the effort and time that would go into manually assessing what SKUs are to be replenished at which darkstores and when to replenish them. Users were able to create replenishment plans instantly for different products across multiple darkstores for a selected duration at just the click of a mouse. Kronoscope with its sophisticated AI engine, helped by automatically creating replenishment plans, factoring in current inventory levels and their runway, open orders, inter store transfers and dynamic safety stock levels. This simplified the replenishment process and they could make these plans in real time seamlessly. With its unique feature of truckload optimization, Kronoscope allows its users to ensure that you can maximize your shipment size without any hassle. This leads to reduced transportation spend and higher savings.

It's undebatable that delivery time, products offered/availability, offers & discounts on the products etc. are the key factors that offer customer delight. That being said, with more players setting foot in the grocery delivery space each day, it is ideal to gain a competitive advantage to achieve your business goals. Kronoscope is exactly that, taking a step towards automating the supply chain driven by technologies like AI and ML has never been easier. Gain end to end visibility and enable proactive planning to grow at an exponential pace. At the end of the day one who ticks the high customer satisfaction checkbox is the one who wins. 

Access the

Blog

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.

The growing fleets of online grocery delivery companies and their darkstores, has made light speed delivery of fresh supplies the norm today. The players in this space are constantly in the quest to acquire more customers and become market leaders. They entice customers with competitive prices, shorter delivery times, Gen Z branding strategies, personalized pop up messages and refer-a-friend promotions. However, their ultimate success lies in offering high-quality groceries, straight to people’s doors, in less time than it takes to pop to the local corner shop. 

And that doesn't come easy! There's a lot that goes into ensuring operational efficiency at all levels of the supply chain and maintaining optimal inventory levels. 

Let’s understand how Kronoscope has helped one of our clients, a leading Q Commerce startup, to overcome operational difficulties and offer a satisfying customer experience consistently. 

About the client

The client is a 10 minute grocery delivery service that employs a dark store business model. Currently, they have over 40 darkstores at various locations including Mumbai, Delhi, Bengaluru, Gurugram, and Chennai. 

What is a dark store?

Dark stores are distribution outlets that are not open to visitors. These micro warehouses quickly and accurately fulfil orders and thus provide shoppers with resources and options like purchasing products online, same-day delivery, or pickup in-store. The "dark store model" curbs the trivial challenges any delivery service faces, traffic congestions, navigation, and connectivity. 

Business Challenges

  1. Lack of visibility at the darkstore level disrupting timely deliveries
  2. Space Constraints in the dark store model
  3. Poor customer satisfaction due to product unavailability  
  4. Frequent promotions making inventory planning difficult
  5. The need for frequent and timely replenishment due to perishable nature of product

Overcoming these Challenges with Kronoscope

Speedy Deliveries

The key to ensuring on time deliveries is having highly accurate demand forecasts at the most granular levels of the supply chain and having end to end visibility. It is crucial to stay on top of demand trends and fulfill customer needs to sustain in the market. For instance, the demand for meat and eggs on a weekend might be slightly higher than that on weekdays. The demand for certain fruits and vegetables might surge during certain seasons. It is essential to identify these patterns and quickly catch up on them in real time. It’s challenging to plan inventory in an agile manner so as to meet unanticipated demand surges or dips due to factors like even change in weather.

Kronoscope uses the bottom up approach in which the demand is predicted at the most granular levels of the supply chain (i.e) darkstore and then rolled up to the top levels. This enabled them to sense demand signals as close to the customer as possible. Kronoscope offered the client unmatched demand prediction accuracy by leveraging high levels of data granularity to analyze daily demand information at the most granular levels like darkstores. It factored in nine major signals such as historical sales trend, seasonal effect, cyclicity, outlier correction, change in pricing, promotions, weather, similar product and store attributes which are pivotal for shorter shelf life products. This enabled the client to plan their inventory in a way to fulfill orders more quickly and efficiently. Further, having end to end visibility helped them plan inventory proactively and work collaboratively by communicating real time updates.

Dark Store Space Optimization

Though dark stores enable speedy delivery, they have space constraints which requires efficient inventory management. It is crucial to plan inventory in a manner that the available space is utilized judiciously. Further, shorter shelf life of products makes this task complex. Companies often misjudge inventory levels resulting in wastage or even delivery of stale products sometimes. This can affect working capital largely and damage brand reputation. 

Kronoscope, with its inventory control tower, helped the client to proactively identify multiple SKUs across darkstores which have to be liquidated. This prevented inventory pile ups and additional storage costs. Further, it uses the FIFO method to evaluate inventory aging and recommends which stock is to be cleared out first. This helped ensure the delivery of fresh supplies always. Furthermore, the purchase & replenishment plans are created by considering the demand along with the dark store space. For example if your dark store refrigeration storage can stock 50 units for ice cream tubs but your demand shows a requirement of 80 units, the plans would be adjusted to ensure that there is no wastage due to excess quantity.

Product Availability

Convenience is one of the major factors that drives customers to shop for groceries online. Hence, it is important to offer the right product assortment and ensure their availability at all times to gain customer loyalty. However, stock outs are a common theme across the grocery delivery space. It becomes almost inevitable to ensure consistent availability of all SKUs across different locations. Groceries require instant gratification and failure to do so may result in loss of revenue. 

Kronoscope equipped the client with the ability to grab every revenue opportunity with its potential stock out alerts. It helped ascertain current inventory runway, predicted demand for the duration, stock out period and the potential stock out loss. They were able to avoid incurring potential out of stock losses by creating purchase plans for those particular SKUs. With inter store transfers recommendations, they were able to ensure balanced inventory levels and consistent product availability. Further, dynamic safety stock recommendations based on demand variability and service levels came in handy to tackle unexpected stock outs.

Promotional Impact

Grocery delivery businesses are constantly trying to come up with innovative and value adding promotions. As much as it is important to run these promotions regularly, it is equally important to plan inventory to fulfill these promotional uplifts. When customers find that the discounted products are out of stock, it only adds to their disappointment.

The client was able to seamlessly plan inventory for their promotions at any level of the supply chain with Kronoscope. This was done by accurately predicting demand for any events and promotions. They could feed in promotional events with their impact segment, type and duration. This helped the system capture promotional impacts and factor it in to predict demand for future events that are similar.

Frequent and Timely Replenishments

Groceries have shorter shelf life and inventory turns due to which they have to be replenished frequently in a timely manner. This can become a grueling task when there are thousands of SKUs across multiple locations. 

With Kronoscope, the client could save all the effort and time that would go into manually assessing what SKUs are to be replenished at which darkstores and when to replenish them. Users were able to create replenishment plans instantly for different products across multiple darkstores for a selected duration at just the click of a mouse. Kronoscope with its sophisticated AI engine, helped by automatically creating replenishment plans, factoring in current inventory levels and their runway, open orders, inter store transfers and dynamic safety stock levels. This simplified the replenishment process and they could make these plans in real time seamlessly. With its unique feature of truckload optimization, Kronoscope allows its users to ensure that you can maximize your shipment size without any hassle. This leads to reduced transportation spend and higher savings.

It's undebatable that delivery time, products offered/availability, offers & discounts on the products etc. are the key factors that offer customer delight. That being said, with more players setting foot in the grocery delivery space each day, it is ideal to gain a competitive advantage to achieve your business goals. Kronoscope is exactly that, taking a step towards automating the supply chain driven by technologies like AI and ML has never been easier. Gain end to end visibility and enable proactive planning to grow at an exponential pace. At the end of the day one who ticks the high customer satisfaction checkbox is the one who wins. 

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