Inventory is often a lot to handle, but demand forecasting and planning software make the headache disappear. You can get a grip on your inventory and become much more aware of what demand is headed your way.
You might ask yourself a variety of questions like why do companies choose to use demand planning systems? Does demand forecasting software really help? Today we’ll explore the answers to these questions, and more.
Demand planning tools are helpful resources. There are many areas of company operations that are positively influenced by effective demand planning software.
Demand planning software is a tool that uses data to produce forecasts that can be analyzed to make effective operational plans. If a company has inventory, chances are demand planning tools can benefit them.
Demand planning and forecasting software are used by all kinds of businesses. These industries include retail, manufacturing, automotive, food & beverage, and more.
Why?
There are large costs involved in successfully operating a business. Any area that can be adjusted to save financial resources ought to be explored. Let’s look at some of the costs revolving around inventory.
The actual purchasing of inventory is a big expense. Mistakes in the amount of inventory have an expensive domino effect. If there’s too much inventory, your business must pay people to manage it, cover storage costs, all while you’ve already lost money by ordering too much product. On the other hand, often there isn’t enough inventory. This can be an expensive mistake as well as you lose customer loyalty because they no longer find your company reliable. It’s rather sad, but one “out of stock” instance can destroy the loyalty of even your most frequent customer.
Does it Really Help?
Unfortunately, the headache of demand forecasting is no secret to your demand planner. With effective demand planning tools, frustrations melt away. To help you effectively meet projected demand, this software prioritizes actions that need to be made. It also suggests how you should use different resources and ensures your company will have an accurate inventory.
For example, demand planning tools show you months, or even years, of future demand. This gives you so much freedom as you no longer blindly make plans. Let’s say you’re looking at the next 6 months of forecast demand. The forecast shows a large spike in demand around the holidays for your most popular products. This knowledge allows you to adequately prepare to provide inventory for your consumers.
Having this awareness helps you in different areas. You have more direction in your marketing plans, order just the inventory that’s forecast to sell, schedule the right amount of labour, keep your warehouse organized, and more. The bottom line is demand planning systems greatly benefit companies that implement them.
In today’s constantly shifting market, you can never be too prepared. It’s impossible to know everything that lies ahead, but demand forecasting and planning software allow you to be as ready as possible to successfully meet whatever happens.
