First quarter demand for Ocean Spray products greater than anticipated.
 
SuperValue again advises member stores to pull Ocean Spray products out of house ads as co-op faces problems filling orders.
 
For the second time an internal SuperValue memo (Click here to read Memo) has come to the attention of Cranberry Stressline (click here for previous memo dated March 2, 1999) advising stores to remove Ocean Spray products from house ads, this time for May 23rd and May 30, 1999.  These were to be promotions for the 64 oz. cranberry blends and the 48 oz. grapefruit blends. The memo cites production problems at Ocean Spray and apologizes to the stores for the lack of notice stating that "Ocean Spray has not lived up to their commitments on shipping product for these promotions."

In a letter, also obtained by Stressline,  dated April 16, 1999 from Nancy McDermott, Senior Vice President in charge of Ocean Spray's In-Home Strategic Market Unit,  distributors are informed that  "Ocean Spray continues to face problems filling your orders and must now reduce promotional volume to restore the level of service you need. Effective immediately we are canceling all promotions scheduled for May and June to help replenish our inventory".

She goes on to attribute the problem to a misjudgment in demand in January which depleted inventory, and stronger than anticipated demand in February and March.

According to the letter, all previously planned promotions with shipment dates prior to June 21, 1999 are being cancelled. Plants, it is pointed out, are producing at capacity and have yet to reach manageable inventory levels.

Ocean Spray is in the process of implementing their Enterprise Resource Planning (ERP) program which when operational is expected to streamline all business processes. The ERP is a $30 million high-tech system for integrating all of the companies business operations. McDermott's letter states that Ocean Spray planned for some slowdowns while operations transitioned into the ERP program, they did not anticipate the high number of orders which were received.

The In-Home Division of Ocean Spray is an $800 million unit which is responsible for marketing all Ocean Spray cranberry and grapefruit products. McDermott was recently promoted to the head of the division from her prior position as senior vice president of Operations-Value Chain.  Her responsibilities included managing the implementation of the Enterprise Resource Planning system.

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