Celonis & Peech optimize retail & CPG operations with new inventory lifecycle solution

Celonis and Peech are optimizing retail and consumer packaged goods (CPG) operations with the launch of a new inventory lifecycle solution.

The Inventory Lifecycle Optimization app, co-developed by Celonis and Peech, enables retailers and CPG companies to reduce product waste and lost revenue by optimizing the process of managing perishable inventory.

The solution is expected to significantly enhance process compliance, reduce spoilage and maximize revenue from limited shelf-life inventory.

Celonis and Peech optimize retail and CPG operations

Adjusting, or marking down, the price of products with a limited shelf life, such as fresh produce, baked goods or any product that can become unmarketable, is a critical aspect of inventory management for retailers and CPG businesses, Celonis said. It’s also critical for reducing food waste.

Traditional inventory management systems can identify perishable products that are at risk of expiring, but they lack the ability to track adherence to standard markdown processes. Missed markdown opportunities can result in needless product disposal, which leads to inventory loss (or shrinkage) and negatively affects revenue.

“Retail and CPG’s incredibly tight margins leave no room for operational inefficiencies,” said Dean Tarpley, industry principal for retail and CPG at Celonis. “The Inventory Lifecycle Optimization app enables organizations to identify process improvement opportunities, take action to increase markdown adherence and monitor the effectiveness of those efforts.”

A leading global retailer is already using the solution to minimize shrink in perishable inventory, improving its sell-through rate by 2 percent and leading to a projected US$35 million in recaptured revenue, Celonis stated.

The company discovered that many of its stores were not consistently following standard discounting procedures for perishable goods in departments such as bakery, meat and prepared foods. This lack of process adherence was resulting in missed sales opportunities, higher food waste and increased compliance risks.

By implementing the Inventory Lifecycle Optimization app, the company enabled regional managers to track program compliance at the product, store and department levels. The tool delivers weekly insights to help guide staff conversations and improve markdown execution.

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Optimizing markdowns adherence with process intelligence

“By bringing Celonis process intelligence to the inventory lifecycle process, we were able to create a solution that lets retailers and CPG companies answer the question, ‘Did we do everything possible to sell the inventory before it goes bad?” said Anmol Gupta, founder and CEO of Peech.

The solution identifies and quantifies missed revenue opportunities by tracking markdown adherence and highlighting areas for improvement. It provides:

• Increased visibility for data-driven improvements: By monitoring shrink prevention processes across every level of the organization, companies gain deep insights into compliance and uncover opportunities to improve adherence. The Main View dashboard tracks performance and compliance across regions, markets, stores, departments and individual associates, empowering leaders to implement precise, targeted process improvements where they’re needed most.
• Better tracking of intervention effectiveness: Companies can measure the effectiveness of process changes over time with a customizable Monitoring View that focuses on the areas most relevant to their goals. After implementing targeted interventions, teams can track progress through key metrics (such as improvement rates and recaptured revenue) gaining valuable insights into the real business impact of their operational changes.
• Customized reporting: Companies can leverage insights from the app to spark meaningful process improvement conversations through built-in, user-specific notifications. With Celonis Action Flows, customers can schedule automated alerts that highlight performance improvements across stores, departments and other key areas – delivering timely updates directly to managers and decision-makers.

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