Fortenova Group: Delivering fresh insights to reduce food waste and boost revenues
About Fortenova Group
Fortenova Group is one of the largest, most well-known companies in southeastern Europe, with over 100 market-leading brands and business operations in agriculture, food production, and retail.
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About Artefact
Artefact is a new generation of data services company, specializing in data consulting and data marketing, dedicated to transforming data into business impact.
With Artefact and Google Cloud, Fortenova Group built a DataLab that applied analytics and AI to real-world challenges, helping to boost profits and reduce waste.
Google Cloud results
- Drives customer-centric business operations with a data platform that generates high level insights
- Reduces food waste and boosts profits with more accurate forecasts using advanced analytics and AI
- Democratizes data and empowers users across the group to use available data in decision making
Reduced food waste by 7% with AI-led forecasting
Everyone has an opinion about food, but few people know as much about it as Croatia's Fortenova Group. Established in 2019, after one of the most successful restructuring processes on global scale (winning the Turnaround and Transaction Award in 2019 from global Turnaround Management Association), the Group today comprises more than 40 companies operating in retail, food production, and agriculture, across five countries in southeastern Europe. It employs more than 45,000 people, and carries more than 4,000 products that are an indispensable part of the everyday lives of millions of customers in the region.
Fortenova Group is constantly looking for ways to optimize its processes and innovate to address critical global issues—like tackling food waste. Fortenova Group and its operational companies have signed the voluntary agreement on preventing and reducing food waste "Together Against Food Waste" with the Croatian Ministry of Agriculture. In addition, Konzum, one of the food and retail brands in the Group, has held the title of The Best Food Donor, having donated more than 1,300 tons of food.
In order to achieve its ambitious goals, Fortenova Group has to ensure that its resources are used efficiently and responsibly, which means having highly accurate data across all of the Group's operations. The businesses in Fortenova Group had plenty of data on their processes and customers, but lacked the technology and the know-how to build more advanced analytics solutions needed to extract value from this data.
In 2021, the Fortenova Group embarked on an ambitious strategy of digital transformation, with one of the pillars being the development of a single cross-company data platform designed to increase revenues and margins, improve customer engagements and drive innovation. The first step on that journey began with Google Cloud.
"We wanted to transform from a data-rich company to a data-driven company," says Dragan Mrkajić, Data and AI Strategy Director, Fortenova Group. "We had more than 30TB of data that was not being used to its full potential. With Google Cloud, we saw the opportunity to translate that data into powerful insights that would have a real business impact."
"We wanted to transform from a data-rich company to a data-driven company. We had more than 30TB of data that was not being used to its full potential. With Google Cloud, we saw the opportunity to translate that data into powerful insights that would have a real business impact."
—Dragan Mrkajić, Group Data and AI Strategy Director, Fortenova GroupDesigning a DataLab for retail and food production
For a multinational conglomerate operating across three sectors, digital transformation was a daunting prospect. Fortenova Group decided early on to focus its early efforts on data analytics and AI.
The Group had been successful at collecting data, especially from its retail operations, primarily from millions of transaction level data points. Fortenova Group's loyalty programs are extraordinarily successful with up to 80% of purchases swiped with loyalty cards. However its on-premises technology infrastructure meant that analyzing so much data was both time consuming and hard to manage. Coordinating between the Fortenova Group's different businesses was a challenge at scale.
Fortenova Group set up a new initiative: Fortenova DataLab, which brought together Data Scientists, Engineers, Analysts, Product Owners and some of the company's top retail experts, to tackle some of the toughest challenges in the world of retail. "The Fortenova Group DataLab is really our center of excellence for data-driven decision making," explains Mrkajić. "We really wanted to build the DataLab as a capability, rather than just a platform, so that we could solve any business problem with data in the future."
But Fortenova Group needed help designing and deploying DataLab. It spent months looking for the right partner with strong data expertise before choosing Artefact, which had carried out similar projects elsewhere in Europe. "Artefact had the right kind of experience, but they also had the best combination of technological expertise and the skills to help us build our internal data capability that would be sustainable in the long run," says Mrkajić.
Next, Fortenova Group had to find the right infrastructure. It had previously relied on on-premises bare metal infrastructure and proprietary data warehouses, which did not allow for the computational power elasticity needed to run advanced analytics cases, and generally did not allow for easy data access. Moving to the cloud would help to eliminate performance concerns, provide a scalable infrastructure, and improve disaster recovery.
Fortenova Group chose Google Cloud for its stability, its ease of use and, above all, for its ability to scale powerful data analytics. "In order to reach its ambition of becoming a data centric company, Fortenova Group needed to rethink its Technical Data Stack. It made a lot of sense to go with Google Cloud, which offered highly managed services and an almost one of a kind data warehouse component solution in BigQuery. Additionally, its track record with retail clients was impressive," says Elina Ashkinazi-Ildis, Partner, Artefact.
Optimizing for analytics and AI
One of the first tasks for the Lab's Data Engineers was to design and deploy a data platform that would ingest data from various sources and be readily available to the lab's use case teams and to users across the company. The technological backbone of the DataLab is a highly scalable data warehouse built with BigQuery and Cloud Storage.
Fortenova Group then started work on more sophisticated data handling, using BigQuery ML and Vertex AI, along with other open source components, in order to build, test and deploy their analytical solutions, from a simple dashboard to the most advanced ML models. "With Google Cloud, we have easily integrated a number of third-party tools to use within our AI platform and tailor it to our needs," says Petra Hajduković, Data, BI, and Platform Lead at Fortenova Group DataLab. "Vertex AI in particular makes it very easy to build, train, and monitor our machine learning models without needing an army of specialist engineers."
The Group's data scientists and analysts use Looker Studio to quickly build reports, create visualizations, and educate the rest of the business on how data can improve decision making, save time and generate strong business value.
Within the DataLab, Fortenova Group deployed Google Workspace, which has led to increased collaboration and more efficient ways of working. "We didn't really have a way to properly collaborate online before Google Workspace," says Ivana Mandušić Hrupački, Change Management Director, Fortenova Group DataLab. "Using Google Chat or live editing in Google Docs or Google Slides means that we can collaborate in real time instead of just emailing files back and forth. It's been a huge positive change for us."
"With Google Cloud, we have easily integrated a number of third party tools to use within our AI platform and tailor it to our needs. Vertex AI, in particular, makes it very easy to build, train, and monitor our machine learning models without needing an army of specialist engineers."
—Petra Hajduković, Data, BI, and Platform Lead, Fortenova Group DataLabData-driven decision making for real world results
With Artefact and Google Cloud, Fortenova Group has delivered a DataLab tailored for advanced analytics and machine learning use cases. So far, Fortenova Group has concentrated on three in particular: demand forecasting for fruits, vegetables and meat, assortment building and management, and promotional activity optimization. Focusing on these has resulted in real impact for Fortenova Group's retail activity.
An early success for the Fortenova Group DataLab has been the forecasting model for fruits and vegetables that has contributed directly to the Group's sustainability goals. The forecasting model uses machine learning to take in historical sales, promotions, inventory data, and more to generate a daily forecast that in turn helps store managers place more accurate orders and reduce waste.
The fruits and vegetables category forecast has been adopted in a pilot scheme of 65 Konzum stores in Croatia, reducing food waste in this category by 7% and leading to an 8% boost in profits. From mid-June, 500 Konzum stores in Croatia are using recommendations from this model.
Store managers say it feels like having an extra helping hand during the ordering process while customers benefit from having the products they want. This is a critical challenge since fruits and vegetables have a limited shelf life and can quickly become unsellable.
"The digital transformation is not about the technology, but about us becoming more customer-centric," says Mrkajić. "Not being able to find the fruits and vegetables they want is a huge irritant for customers. On the other extreme, it's not good when we have to dispose of fruits and vegetables that haven't been sold. So being able to forecast that demand accurately is a big deal for us."
The DataLab is as much about democratizing data as it is solving particular business challenges. The platform offers self-service data sandboxes, which facilitate easy access to and manipulation of data in a controlled and secure environment for anyone inside the Group. The DataLab also boasts a monitoring command center that tracks platform performance, security, and reliability, providing the team with the ability to quickly identify and address any issues that arise. Artefact and Fortenova Group also designed a "tenant-as-a-service" capability for the platform which allows users to connect their data and start building and testing machine learning models in as little as 30 minutes.
As a result, the DataLab has successfully demonstrated through its first use cases that predictive analytics solutions in the hands of motivated business teams open to new ways of working, really do result in happier customers and a tangible business impact.
After the success of its first year in operations, Fortenova Group is looking to build on its digital transformation across the rest of the organization. "The DataLab has fundamentally changed what we are able to achieve, making us smarter and more insights-driven, faster, and better able to connect and collaborate with others," says Mrkajić. "We are excited to continue our journey with Google Cloud and explore even more possibilities for transformation and growth."
"The DataLab has fundamentally changed what we are able to achieve, making us smarter and more insights-driven, faster, and better able to connect and collaborate with others. We are excited to continue our journey with Google Cloud and explore even more possibilities for transformation and growth."
—Dragan Mrkajić, Group Data and AI Strategy Director, Fortenova GroupTell us your challenge. We're here to help.
Contact us
About Fortenova Group
Fortenova Group is one of the largest, most well-known companies in southeastern Europe, with over 100 market-leading brands and business operations in agriculture, food production, and retail.
About Artefact
Artefact is a new generation of data services company, specializing in data consulting and data marketing, dedicated to transforming data into business impact.