Planning and risk assessment is, by its very nature, uncertain at each stage of the product's life cycle, however - accuracy improves as more and better information becomes available. An approach to gross margin-maximized planning should account for the variability in uncertainty at each stage of the product life cycle.
As product lifecycles shrink and new generations of products enter the market more quickly, achieving bottom-line results requires the estimation of overall demand and product mix as accurately as possible. Products with manufacturing lead times of weeks, months or even quarters are all the more critical to forecast correctly to ensure optimum levels of inventory holdings and eliminating stock outs.
The first step is to gather all available information and perform predictive modeling- recognizing that at each product stage the objective is different. During "merchandise test" or "initial buy" stages, uncertainty is very high and predictions and perditions play a prominent role. At the "read/react" or replenishment stages, and at the final, "end of life" stage there is much less uncertainty remaining.
Manage your Demand through Planning and Risk assessmen
We use advanced statistical techniques to match changing product objectives. The risk, for example, of stock out early in the life needs to be balanced with the obsolescence cost at the end. No single technique or approach works all the time, and therefore we adopt a combination of various techniques to minimize uncertainty which in turn helps retailers to reduce stock outs and closeout costs while maximizing gross margins.
Market Equations helps retailers convert point-of-sale and inventory data to actionable information that enables the company to optimize stock levels. We also provide retailers a better understanding of consumer demands and the ability to understand demand fluctuations, which greatly enhances its ability to anticipate and respond to the needs of its retail partners.
Use Demand Planning through reliable forecasts and increase profits. Write to Us
