“ Knowing your customer is an enormous benefit to demand planning ” running joke among supply chain professionals is that , in today ’ s uncertain and volatile world , what they really need is not a welter of technology , but the services of a clairvoyant armed with a crystal ball . But in the absence of such help , the next best thing is an old-fashioned , non-mystical demand-planning professional .
The importance of demand planning has been elevated by ongoing postpandemic supply disruption , happening against a backdrop of war in Ukraine , rampant inflation , workforce volatility and the looming spectre of recession But what is supply chain demand planning , exactly ? This is the process of predicting customer demand for products or services and determining the amount and timing of inventory needed to fulfil that demand .
The goal is to optimise inventory levels , reduce out-of-stock instances and improve customer service levels , while minimising costs and inefficiencies .
It is a skill that is built on data analysis around customer-demand patterns , market trends , sales forecasts , and historical sales data .
JEFFERSON BARR , CHIEF MARKETING OFFICER ,
NETSTOCK
This information is used to build a demand plan , which outlines the expected demand for products or services over a specific time period .
Once the demand plan is in place , supply chain professionals can use it to determine the amount and timing of inventory needed to fulfil that demand . This can involve working with suppliers to ensure timely delivery of raw materials or finished goods , managing warehouse inventory levels , and coordinating production schedules to meet demand .
Effective supply chain demand planning is critical for businesses that want to stay competitive and meet customer needs while minimising costs and inefficiencies .
By accurately predicting demand and optimising inventory levels , companies can improve customer satisfaction , increase revenue , and reduce waste and inventory carrying costs .
Here , we speak to Jefferson Barr , Chief Marketing Officer at supply chain planning specialist , Netstock . Barr gives his views on how the pandemic and technology has changed the discipline , but also how key elements of it remain unaltered .
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