Push Promotion Program Brief Commissary Roundtable April 21, 2016 Presented by Mike Pfister, SO & Dennis Chambers, D&S

Collaboration – Thank You Valuable Insights Time investment Motivated to improve the program

Push Program Yesterday Today Tomorrow We Can Do Better!

Before Push Program Limited collaboration between DeCA and Industry on forecast Varying levels of support to stores Inconsistent communication to Distributors High Distributor inventory on past Display Packages

Today – Push Program Tools developed to enable collaboration Consistency in process Improved collaboration between DeCA, Suppliers and Distributors However, results are not optimal

Current Process Sales Publishes DP Store Ops develops Push File w/ Distributor information Push file sent to Brokers / Suppliers Brokers / Suppliers input suggested quantities and returns to DeCA Store Ops combines file into one document and adds 52 week average movement – sends to stores Stores input quantities with limited supplier input – returns to Store Ops DeCA sends final file to Brokers, Suppliers & Distributors Broker / Supplier / Distributor agree on final forecast Stores order product Very labor and time intensive DeCA Store Ops Stores Brokers & Suppliers Distributors Potential for inadequate product forecast to suppliers Multiple methodologies ? Too Much ? Not Enough First Hog to the trough Resulting in less than optimal In Stock profile Current process

Store Ops Forecast Process Test Begins DP 13 MBU publishes DP Store Ops develops forecast by store Push file is sent to: Stores Brokers, Suppliers Distributors Brokers, Suppliers Distributors agree on pipeline fill Historical scans * lift factor = Forecast Store and Suppliers review for exceptions: Mass Display End Cap Current Inventory Extraordinary support Prior Promotion exceptions (Out of stocks) Final quantities provided to Distributors Final quantities are minimum for pipeline fill Industry responsibility to make sure there is sufficient product in the distributor for the entire DP Additional inventory for pipeline based on supplier and Distributor agreement

Current Results Variance to actual forecast from stores are low and brokers high Forecast Algorithm test DP2 through DP7: 5,050 case variance to actual = 0.2% variance

Store Ops Forecast Outcome Improve: Forecast Consistent Process Store compliance Supplier lead time Pipeline fill In-stock

Future Enhancements Store Compliance Reporting Distributor Fill Rates to stores Speed to Merchandise Supplier fill rates to Distributors