Santa Cruz Nutritionals optimizes supply chain planning with Oracle Cloud

Santa Cruz Nutritionals, the leading North American contract manufacturer of enhanced confectionery for the functional food and nutraceutical markets, ran into supply chain difficulties when the pandemic spurred tremendous growth in the nutraceuticals industry.

The business relied solely on spreadsheets, which made demand and supply planning slow and error-prone. In addition, the unexpected surge in demand for gelatin-based dietary supplements and functional food caused many products to go on back-order for months, while the company’s production and purchasing divisions were unable to adequately manage the uncertainty.

The 50-year-old California-based company decided to implement a cloud-based supply chain management system that would scale as the business expanded. Santa Cruz Nutritionals selected Oracle Cloud Supply Chain Management (SCM) to improve demand forecasting accuracy and inventory strategy.

The company selected Oracle Cloud SCM to replace its Xantel AMAPS manufacturing resource planning system after a thorough assessment in partnership with Kalypso (formerly AVATA), a leading Oracle cloud applications system integrator.

Santa Cruz Nutritionals found that Oracle Cloud SCM was the most resilient supply chain platform suited for the company’s rapidly growing business needs. Oracle Cloud SCM optimized Santa Cruz Nutritionals’ business, allowing faster and smarter business decisions while outpacing change.

After deploying Oracle Cloud SCM, Santa Cruz Nutritionals attained enhanced visibility into demand and supply data that flowed from sales orders and points-of-sale terminals. The company also replaced spreadsheet approximations and streamlined production and delivery strategies.

Oracle Cloud SCM gave the organization’s purchasing staff the comfort of knowing that buying signals were based on real orders from customers, while production managers could optimize the manufacturing schedule, reduce unplanned downtime, and smoothly gear up to meet the estimated 7.5% compound annual growth rate in the US nutraceuticals market.

With data from all sources vetted through Oracle’s data quality engine and funneled automatically into Oracle Cloud SCM Demand Management, supply chain planners worked with their commercial teams to arrive at 12- to 18-month forecasts, factoring in market insights such as pricing, promotions, channels, new product introductions, and competitive activity.

Based on current and projected customer demand, the new cloud platform reduced inventory errors by 40% through Oracle Cloud SCM’s allocation of the correct gummy raw material ingredients into the optimally located manufacturing facility and distribution center.

Using Oracle Supply Chain Planning, Santa Cruz Nutritionals calibrates purchases and manufacturing by releasing planned order recommendations that trigger a real-time planning and approval process to balance supply and demand.

By entering the required data to identify trends, seasonality, and cycles into Oracle Supply Chain Planning, the company gained the ability to create statistical forecasts and analyze the current forecast versus previous outcomes. The system also enabled the company to development what-if strategies based on real-time changes in customer behavior and market dynamics. Oracle Supply Chain Planning’s automated replenishment alerts, triggered by real-time point-of-sale data, ensured the availability of products at the optimal warehouse to meet the surge in demand.

In addition, Oracle Cloud SCM helped Santa Cruz Nutritionals maintain the integrity of product margins in line with escalating customer demand, while also adjusting to fluctuations in purchasing and production requirements.

Santa Cruz Nutritionals selected partner Kalypso to help implement Oracle Cloud SCM over a four-month period. Kalypso helped promote full user adoption of the new solutions through rigorous documentation and training.