Terra Technology was founded in March 2001 to give manufacturers a structured way to improve their demand forecasting accuracy. The company's Demand Sensing and Inventory Optimization software products interpret demand data in real time to generate intelligent daily forecasts and smooth supply chain operations.
"We're looking at the latest downstream data and adjusting forecasts every day, by location," rather than weekly or monthly and drawing only on historical data, says Robert Byrne, Terra's president and CEO. Analyzing order or point-of-sale data provides an up-to-date demand picture that can then be used to generate more accurate forecasts. The results: a more stable supply chain, less inventory, more accurate deployment, less transportation, and less warehousing. "We're cutting forecast error by roughly 50%," he adds.
Procter & Gamble began using Terra's Demand Sensing and Inventory Optimization products over a year ago in a pilot project in Western Europe. Thanks to Terra's software, P&G reduced its safety stock by more than 15%. "We have a very, very big business. That kind of saving is significant," reports Mark Kremblewski, global business expert, demand planning.
"This is the only [project] with absolutely true, verifiable, proven results that I've seen," Kremblewski says. Terra's products make it "easier to take the savings to the bottom line," he says, and "actually make the life of the user easier." P&G is expanding its use of Terra's products in Europe and North America.
Looking ahead, Terra's Byrne says: "The next interesting area for us is transportation forecasting. A lot of people don't have enough visibility into their lane volume." With accurate forecasts of shipping volume and destinations, customers can save money by reserving transport and negotiating pricing in advance.
- YEAR FOUNDED: 2001
- PRODUCT NAME AND CATEGORY: Demand Sensing and Inventory Optimization/supply chain
- INDUSTRY SEGMENTS SERVED: Consumer products,
pharmaceutical
- KEY PROBLEM SOLVED: Provides more accurate forecasts and inventory targets
- DIFFERENTIATION: Forecasts are adjusted daily, in every location, based on real-time downstream data
- TOP CUSTOMERS: Procter & Gamble, Campbell Soup,
Ventura Foods
- FUNDING: Bootstrapped, no VCs