Keep Calm and Demand Plan: Demand Planning Best Practices
Guidance on moving from reactive to mature demand planning using ABC classification, demand patterns, COV, SD, and MAPE to align supply with demand.
This white paper explains how planners can reduce excess inventory and improve service levels during supply disruptions. It covers distinguishing demand from sales, classifying SKUs by impact, identifying demand patterns, applying COV and SD for safety stock, measuring forecast accuracy with MAPE, and incorporating qualitative inputs. The document also addresses cross-functional collaboration and warehouse capacity considerations.
ABC classification focuses planner effort on high-impact A items first.
Demand statistics provide better forecasting inputs than sales data alone.
COV and SD metrics help right-size safety stock based on demand variability.
MAPE tracking and algorithm selection improve forecast accuracy over time.
Cross-functional input from sales and marketing refines forecasts and supply strategies.
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