JDA Teams with Ace Hardware to Increase Upstream Supply Chain Visibility
Contact:
JDA Investor Relations
The Berlin Group
Lawrence Delaney, Jr., 714/734-5000
larry@berlingroup.com
or
JDA Public Relations
Michelle Kershner, 480/308-3294
michelle.kershner@jda.com
New Collaborative Product First to Generate Order Forecasts Beyond Standard Lead-Time
Scottsdale, AZ--November 20, 2002--JDA(R) Software Group (Nasdaq:JDAS) announced the availability of a new JDA Portfolio(R) Collaborative solution, the Electronic Dynamic Agreement(TM) (eDA(TM)), that answers the fundamental yet complex question of what a retailer will order and when from its suppliers. Developed in cooperation with Ace Hardware, winner of the 2001 Best in VICS CPFR(R) Implementation award, eDA is the first product to dynamically generate a retailer`s order forecast for a supplier beyond the standard single order lead-time to as much as one year into the future thereby leveraging downstream demand with actual order logistics translation variables. As a result, trading partners can improve inventory productivity, customer service levels, product availability and first time fill rates.
"With eDA we`ve made a significant breakthrough in bridging the gap between a retailer`s order lead-time and a suppliers` ability to economically manufacture, pick and ship goods to their retail customers," stated Kevin Stadler, JDA`s senior vice president of collaborative solutions. "By further increasing supply chain visibility upstream, our clients can decrease costs, drive sales and increase cash flow, which ultimately translates to lower prices for consumers and a boost to our trading partners` bottom lines."
Ace Hardware Champions Revolutionary Collaborative Processes
With sales exceeding $13 billion, Ace launched its Collaborative Program in 1999 and today has achieved success with 22 suppliers collaborating on CPFR processes via the JDAMarketplace.com(TM) portal and the Marketplace Replenish(TM) solution. Encouraged by improved sales on reduced inventory levels and other positive outcomes, Ace teamed with JDA in 2001 to help drive eDA`s functional design and test its capabilities with a supplier.
According to Greg Lenard, Ace Hardware`s director of inventory control, and a well-respected industry champion for the advancement of collaborative processes, "We can all share POS information and sales forecasts, but that doesn`t translate to what we are going to buy and when from our suppliers. After a year of design, tweaking and testing, we`ve taken a huge step forward in validating that the JDA solution does what it`s supposed to do in the real world as opposed to all the collaboration hype that exists today. I have not seen another model in the industry with the potential to scale and provide significance for other trading pairs as I see with eDA."
Explaining why Ace took on the role of early adopter, Lenard stated, "Who ultimately benefits when a retailer and a supplier share data and have a joint vision of the future? The consumer. When consumers` expectations are not met, they vote with their dollars and shop elsewhere. Until we have a sale, we have nothing."
"As part of JDA`s development philosophy, we believe that it`s critical to secure a client sponsor to help drive our product`s functional design and validate its value in a production environment," commented JDA`s Stadler. "Our friends at Ace Hardware are first-rate partners. Greg and his team have provided thought leadership that`s been instrumental to our successful launch of a market-ready eDA product."
Transforming Uncertainty to Accuracy with eDA
The creation of order forecasts has been such a challenging and uncertain process due to a wide number of variables. These range from how often an item needs to be ordered to how much of an item the retailer needs to have on hand to satisfy its service levels, safety stock and presentation stock requirements. Adding to this complexity are the supplier`s constraints on each item such as required lead-time, order multiples (e.g. an item ordered by the case pack or convenience multiples such as layer or pallet) as well as minimum and maximum shipping requirements. According to Lenard, eDA automatically takes into consideration all of these variables along with the sales forecast, promotional activities and deal buy opportunities to produce a reliable and accurate order forecast.
"What it all comes down to is one word: trust. When you put everything on the table and jointly share credible insight on sales, order and promotional forecasts, that`s very powerful. The end result is both sides know exactly what they are going to achieve and how they are going to do it," explained Lenard.
JDA and Ace now plan to push the processes that they have proved with a supplier`s finished goods inventory up the supply chain. The next phase will have eDA`s forecasted order actually integrated with a manufacturer`s production planning process or Materials Resource Planning (MRP) system. This will enable the manufacturer to reduce supply chain costs even further by making more informed decisions on how much raw materials are needed and when they need to be ordered from the manufacturer`s suppliers.
About eDA
JDA`s Electronic Dynamic Agreement (eDA) creates accurate and stable order projections based on collaborative demand forecasts and enables the sharing of these forecasts with trading partners over the Internet. eDA features new algorithms that translate demand projections into vendor order projections, projection logic that smoothes the impact of demand shifts, a GUI front end, and an intuitive conflict resolution process. With visibility now extended by weeks and even months, retail buyers and their supplier partners can leapfrog the competition with improved inventory productivity, service levels, order fill rates, and reduced safety stock inventory. eDA provides all the algorithms and functionality necessary to fully execute the VICS CPFR(R) business model.
About Ace Hardware
Founded in 1924, Ace Hardware Corporation, headquartered in Oak Brook, Ill., is a cooperative wholly owned by its 5,000 independent hardware, home center, lumber and building materials retailers. Annual retail sales exceed $13 billion. Ace currently has stores located in all 50 states and 72 countries. More information on Ace Hardware can be found on the World Wide Web at www.acehardware.com.
About JDA Software
With more than 4,600 retail, wholesale and manufacturing clients in 60 countries, JDA Software Group, Inc. (Nasdaq:JDAS) is the global leader in delivering integrated software and professional services for the retail demand chain. By capitalizing on its market position and financial strength, JDA commits significant resources to advancing JDA Portfolio, its suite of merchandising, POS, analytic and collaborative solutions that improve revenues, efficiency and customer focus. Founded in 1985, JDA is headquartered in Scottsdale, Arizona and employs more than 1,200 associates operating from 29 offices in major cities throughout North America, South America, Europe, Asia and Australia. For more details, visit www.jda.com, call 1-800-479-RETAIL (7382) or email info@jda.com.
"JDA" and "JDA Portfolio" are registered trademarks and "eDA," "Electronic Dynamic Agreement," "JDAMarketplace.com," and "Marketplace Replenish" are trademarks of JDA Software Group. Any trade, product or service name referenced in this document using the name "JDA" is a trademark and/or property of JDA Software Group. All other trade, product, or service names referenced in this release may be trademarks or registered trademarks of their respective holders.
This press release contains forward-looking statements that are made in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include the statement that our products will improve inventory productivity, customer service levels, product availability, and fill rates, and Mr. Stadler`s statement that JDA`s product will bridge the gap between a retailer`s lead time and a supplier`s ability to deliver. Future events may involve risks and uncertainties, including, but not limited to, uncertainties, including the risk that the products will not improve productivity or product availability, the fact that the product is new, and may not be able to be implemented correctly or may produce unexpected results, and other risks detailed from time to time in the "Risk Factors" section of our filings with the Securities and Exchange Commission. As a result of these and other risks, actual results may differ materially from those predicted. We undertake no obligation to update information in this release.
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