German multi-channel retailer OTTO says it has shortened delivery times and improved customer satisfaction using a machine learning platform.

The artificial intelligence (AI) solution from Blue Yonder accurately forecasts customer demand of OTTO’s products and has now been extended to include goods from its partner retailers, providing automated replenishment across all items. Since the implementation, OTTO has been able to reduce the delivery times of third-party items from up to seven days down to one or two days, without risking overstocking at the warehouse.

At OTTO, around 200 factors are considered to create accurate demand forecasts for goods. The Blue Yonder Replenishment Optimisation system then uses those forecasts to deliver automated decisions using AI. For its predictions, the platform analyses around three billion transactions from past sales, prices and stock levels.

Michael Sinn, director of category support at OTTO, noted: “The benefits of automated decisions becomes evident when you put it into practice. We consider it accurate when we sell out of items ordered from our retail partners within 30 days. With automated replenishment decisions from Blue Yonder, we achieve this 90 per cent of the time. This is extremely valuable for us.”

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