TrueNorth Group - Prosum Profit Optimization Ecosystem

Generative-AI powers enhances decision-making by providing recommendations by combining Azure OpenAI LLM’s and your business data creating significant RGM lift.

Results are fully integrated, with visualizations that are easy to navigate and interpret outcomes, and integrations with analytical and transactional systems to ensure actionable insights are implemented.

Critical Challenges:

Pricing and Promotion decisions are often manual and not based on scientific methods to determine effectiveness, with some studies showing that up to 70% of promotions being ineffective. Managing inventory is a further challenge with 50%+ of companies facing overstocking or understocking leading to sub-optimal working capital allocation. This in a world where only 30% of companies leverage data proficiently for this business problem.

• Thousands of SKUs with different seasonal, macroeconomic and price & promotion sensitivities.
• No measuring system in place to understand the impact on gross profit margins from previous promotions.
• Datasets are disparate across different business units and not consolidated for ease-of-use in AI algorithms.
• Overstocking and understocking of inventory due to demand forecasting models being sub-optimal in accuracy.
• Understanding of the effect of cannibalization of brands due to pricing and promotion decisions.

The Prosum Approach:

Prosum's Profit Optimization Ecosystem provides a blueprint to implement a pricing, promotion and inventory management strategy that delivers measurable impact on revenue and cost optimization.

• Custom designed price sensitivity and promotion affinity scores to measure the impact of changes and cluster products into different pricing strategies (e.g., Everyday Low-Price vs. Everyday Value Price).
• Historical base demand levels per product for effective measurement of past and future promotional impact.
• Machine learning pipelines leveraging Azure Databricks to operationalize thousands of predictive models per product.
• Leading-edge optimization algorithms to maximize gross profit margins through recommended pricing movements, promotion selections and inventory management.

Product Features:

The platform provides a holistic solution for end-to-end Revenue Growth Management with the following built-in features:

• Optimization: Optimal price and promotion management using AI-driven demand forecasting.
• Price Sensitivity: Understand what effect an X-% increase in price will have on the demand levels for each product.
• Market Basket Analysis: Understand the combinations of products being sold to better plan store and shelf layouts and improved promotion selection strategies.
• Demand Forecasting: Forecasting to shape product life cycle strategies for demand and scope of sales over time.
• Visualization: Power BI driven reporting for quick visualization of results.
• Scenario Planner: What-if scenario planning for different pricing, promotions, and inventory management strategies.

Choose from a Core or Enhanced implementation.

The Core plan includes Price sensitivity scores for analyzing the impact on demand given price movements and Promotion affinity scores to determine prime candidate products for promotions, the proprietary price strategy matrix for classifying products into strategies such as High-Low, Everyday Low Price and Everyday Value Pricing with historical analysis of promotions performance compared to baseline expected demand.

The Enhanced plan includes everything in the Core plan PLUS demand forecasting per product using custom algorithm selection methodologies, optimized pricing strategies and promotion selections, and optimal inventory planning.

With our solution, you will be able to increase margins by between 3-6% through optimized pricing, promotions, and inventory management decisions.