Client Situation

Our client is a key player in the US plumbing valves and fittings market serving the residential and non-residential construction industry. It has a 110 year history of serving the plumbing market with 10 plants located in the US, Mexico and Poland. As part of its annual strategic planning cycle, the company uses data from FW Dodge and others to forecast the next year’s sales by product. This approach has been used for years but it has been extremely inaccurate and of limited use as a planning tool for both sales and production.

  • A more robust forecasting model of the residential and non-residential construction market in the US was needed
  • The company hired an analytics firm to provide the model for forecasting demand for its products breaking out the products and building types within residential and non-residential building sectors and how they are used in plumbing, DWV, HVAC, fire, and other applications.
  • It was found that the quantity and quality of the data to be used in the analytics model was insufficient to be used in the new analytics model

Cedar’s Approach

Cedar was mandated to provide “real world” data to the analytics model, detailing the use of specific products made by the client in specific types of buildings for specific applications.

  • Conducted interviews and building site visits to determine the scope and intensity of different valves and fittings used in each type of building.
  • We also made adjustments for use of products and building types by region in the US.
  • Calculated usage coefficients ($ per square foot) for each of the client’s products for each building type.
  • Created an Excel database with building type and product usage coefficients that can be analyzed and updated.

Outcome

The program resulted in the development of a far superior analytics model for the clients business using actual data rather than estimates from secondary sources. The results included

  • Client’s demand forecasting of its products is far more accurate and realistic.
  • Better data in the analytics model resulted in a useful tool for the sales team and distributors.
  • The forecasting model is now used by both sales and production departments.
  • We made Strategy Work

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