April 5, 2021

In conversation with Bernard Verburg, CEO MegaGroup

What are the core-activities of MegaGoup?
MegaGroup is a technical wholesaler for water solutions with facilities through Europe. MegaGroup mission is to provide sustainable energy with accessible, smart and effective water solutions.

What type of Data Science service did SYMSON provide MegaGroup?
MegaGroup works just like Vink with SYMSON, the tool created by SYMSON. The tool analyses prise elasticity through transactions between different customers segments. This analyses provides an overview of the relevant changes in demand caused by change in price. With the help of the tool the company’s price management improves enormously causing the company to acquire higher margins.

How and at which moment did you find out that Data Science would provide added value for your company?
Bernard already had some knowledge of Data Science before joining MegaGroup. And because of this he knew the positive impact Data Science can have on a company’s business processes and profitability. Within MegaGroup we noticed that there was an incredible amount of data, but that far too little was done with it. This is how they came into contact with E-tail Genius in 2017.

In which ways does Data Science contribute to the growth of your company?
SYMSON analyzes products. The insights showed that MegaGroup did not have a logical structure in margins on lead items (main items) and LED items (side products). This caused, the margins on lead items were often too high and the margins on LED items were often too low, this eventually meant the ideal margins were not realized. Additionally, through the use of SYMSON, MegaGroup found that there was also an absolute difference in price per country. This caused the Germany division having a significantly lower gross margin than the division in the Netherlands. By immediately following SYMSON’s advice on a number of products it turned out that there was a lot of room to structurally increase margins and profitability. The tool has helped us a lot in creating this awareness within MegaGroup.

With a focus on the next 5/10 years how will SYMSON contribute to your company’s growth?
MegaGroup would like to become more mature in pricing. Prices are currently being adjusted 2 to 3 times a year and this should be done more regularly in the future. In addition, Bernard would like to use Data Science in demand forecasting. Approximately 1/3 of the products arrive out of Asia, next to this there is currently a large force of seasonal moderation. Ideally, you will have sold out stock at the end of the year, but this requires good demand forecasting. This is still rudimentary and so much can be gained here with the help of Data Science.

What kind of transition has your company undergone because of Data Science?
The use of Data Science has an impact on the entire company, even if there is only a small team that actually works with the tool. MegaGroup has been on the verge of bankruptcy and as a result, sales managers often sold products at a higher discount. By using SYMSON, faith and confidence in the correctness of the pricing models used has increased and the use of discounts to keep the customer satisfied has disappeared. Nevertheless, it is very important that you have a permanent team that can use the tool in such a way that the rest of the company understands. This means converting the difficult terms the model uses in easy to understand language. This will eventually improve the decisions made with the help of the tool.

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