5 Ways To Improve Your Demand Planning

Quickly providing customers with the products that they purchased is key to customer satisfaction. Many an order has been lost as a result of the inability to ship efficiently. The primary factor for on-time shipping is having the right stock levels of the right product at the right time and location. This is the challenge of today’s demand planner, and it is no easy task unless you are using a demand planning tool for inventory management.

If you use complex spreadsheets or outdated systems, it may be time to upgrade to a better solution. Today’s demand planning systems provide sophisticated forecasting capabilities with easy-to-use functions, and many are specifically designed for the wholesale distribution, e-commerce, manufacturing, and retail industries. Here are five ways that you can improve your demand planning with a cloud-based solution:

1. Improve Your Baseline. Your baseline is the initial forecast that is used to compare all subsequent versions. If your initial baseline isn’t accurate, your future forecasts and baseline variances will suffer. To improve your baseline, make sure your system is integrated with your ERP and CRM systems to get accurate historical data.
   
2. Implement Exception-Based Forecasting. Advanced forecasting tools allow you to better anticipate future customer demand. However, having the ability to perform exception-based forecasting lets you prioritize and manage key products.
   
3. Incorporate Dynamic Time Frames. The ability to switch between time frames, such as weekly or monthly, gives you a better view of the necessary safety stock levels.
   
4. Eliminate Complicated Spreadsheets. Having disparate systems and spreadsheets creates silos of data that are not integrated or related to each other. Additionally, there is a limit to the sophistication of the planning models that can be developed in a spreadsheet, and they are prone to errors.
   
   
5. Define Strategic Customer Service Levels. Service level requirements are impacted by many factors, including promotional campaigns, special events, and the types of products customers want. For example, service parts may move in waves and need to be managed differently than regular moving products.

The benefits of improving demand planning are undisputable. A reduction of excess inventory also reduces the investment requirements of holding inventory. Proper levels of product will reduce stockouts, thereby improving customer service and, as a result, customer satisfaction. Revenues and margins are also improved due to the better management of inventory purchases. Additionally, there is a reduction of planning cycle times.

Looking for more information about how to improve your demand planning? Contact Business Solution Partners to speak to an implementation expert today!