Consumer Products Companies Embrace VMI for Practical Customer-Specific Collaboration; Prescient Survey, Customers and Industry Analysts Reinforce Value and Momentum of VMI Programs.

Business Editors/High-Tech Writers

WEST CHESTER, Pa.--(BUSINESS WIRE)--Dec. 17, 2003

Vendor managed inventory (VMI) programs, which enable consumer products manufacturers and suppliers to manage inventory replenishment for their retailer and distributor partners, are prevailing over more complicated collaboration initiatives for their ability to drive down supply chain costs and establish the critical foundation for partner collaboration.

A recent survey of consumer products manufacturers conducted by Prescient, leading provider of supply chain planning solutions for consumer products companies, supports analyst conclusions that VMI is experiencing a resurgence of interest from consumer products manufacturers. Prescient's survey queried its customer base of consumer products manufacturers and distributors as well as additional consumer products companies. According to the survey results, 75 percent of respondents are actively engaging in VMI with an average of six retail partners. In all, respondents named over 40 retailers with whom they conduct business. Industry trends suggest that VMI's practical approach to collaboration and retailers' and distributors' increasing insistence that collaboration programs meet their specific technology standards and other compliance parameters are the driving forces behind this momentum.

Underpinning the VMI collaboration programs of world-class manufacturing and distribution operations like Wyeth and Tropicana, Prescient is also teaming with leading retailers and distributors like McLane Company to help them provide tailored frameworks for VMI to their supplier bases. One of the largest grocery and foodservice distributors and a wholly owned subsidiary of Berkshire Hathaway, McLane has been a long-time proponent of VMI, recognizing early on that there are tangible benefits from this type of supplier collaboration. Already pre-configured to support the EDI specifications of McLane as well as those of other leading retailers and distributors, Prescient delivers a VMI solution ready-made for McLane's suppliers and offers McLane-specific training programs.

"Prescient has been very responsive in building out a solution that is tailored to our specifications," said Beckey James, Electronic Commerce Manager within Corporate Merchandising at McLane. "The information our suppliers deliver to us through the Prescient solution is immediately accessible by our systems, allowing true collaboration with our partners."

Prescient continues to lead the way by providing VMI solutions with a low total cost of ownership. Prescient provides a combination of superior technology and consumer products expertise to empower manufacturers and suppliers to maximize their relationships with retail and distributor partners and meet their evolving technology standards and compliance requirements. With more than 20 years of experience supporting collaborative business processes and relationships, Prescient offers VMI and supporting demand planning technology as part of its comprehensive suite of supply chain planning solutions, Prescient 5.

In The AMR Research Alert, Aug. 7, 2003, analysts Vinay Asgekar and Janet Suleski highlighted the benefits and challenges of VMI: "Research shows that, when done correctly, companies have extracted big benefits:

-- 50 percent reduction in lead time

-- 20 to 70 percent reduction in inventories

-- In-stock improvements of 1 to 12 percent

-- Sales increase in certain fashion categories of 100 percent or

more

Still, fundamental best practices are lacking in many VMI partnerships....The Takeaway: To realize benefits out of the VMI programs, companies need to focus on collaborative practices and customer relationships."

"Many of our clients supply consumer products to major retailers like Wal-Mart as well as to myriad smaller retail and distribution outlets," said Prescient President and CEO Jane Hoffer. "By enabling our customers to find the right flavor of collaboration to meet the individual needs and standards of each trading partner, we allow them to take control of their retail and distributor relationships without sacrificing the needs and requirements of smaller customers. This culminates in greatly improved customer relationships and decision-making across the entire supply chain."

About Prescient

Prescient empowers consumer products manufacturers and distributors, enabling them to maximize their relationships with retailers and trading partners. Prescient gives suppliers the ability to adapt to each of their customers' changing business and compliance needs while improving their own decision-making across the entire supply chain. The company's supply chain software and services incorporate greater visibility into real-time demand and point-of-sale information, delivering more accurate demand, replenishment and production plans to ensure higher service levels without the financial burden of excess inventory. Household brand names like The Dial Corporation, Domino's Pizza, Binney & Smith (Crayola Brand), AAi.FosterGrant and Wyeth Consumer Healthcare rely on Prescient. For more information, go to www.prescientsystems.com.