Retail Demand Planning in 2022
More and more, as supply chains contract and expand due to global disruptions, resource scarcity, and COVID, demand planning is top of priority in Retail and supply inventories. A key first step in determining what to purchase and when is knowing your demand: when to order, how much to order, and what to do with existing inventory is a challenge that every retailer faces, and one that can lead to future confusion and lost profits if not addressed properly.
In short, modern demand planning must be accurate and responsive to changing consumer needs. By staying on top of rising and falling demand and consumer behavior, you can sell better and improve your product turnover. Once you get a handle on your demand planning, you can also locate where labor shortages are being created within your supply chain and address them head on. The name of the game is cutting down on wasting time and resources.
Implementing AI and Machine Learning
Artificial intelligence has the power to drive your demand planning with accuracy and speed. AI is able to compile and store massive amounts of data, as well as give meaningful insights into an infinite amount of challenges and variables. “AI can accurately analyze high volumes of data and identify patterns and apply decision rules much faster than people using traditional technology or spreadsheet-based solutions, but only 2% of FP&A functions have adopted AI,” says Richard Ries, VP, Advisory, Gartner. “Our research suggests the low adoption rate stems back to three main barriers. Leaders must remove those obstacles to realize the full potential of AI.”
Meeting consumer demand is key when employing AI in your business. Whether it be a holiday season or a promotional period, automated insights can give you accurate forecasts on what to have and what not to have on hand as your demand requires. You can also analyze historical data and trends to get the full scope of your supply history, and communicate effectively with key suppliers.
Forecast Accuracy and Demand
After compiling and analyzing your data, forecasting with accuracy becomes much easier. Analyzing massive amounts of data allows you to look at seasonal changes in demand, as well as receive insights into high priority items or high turnover items. Collecting data allows e-commerce and retail companies to further predict future patterns for consumers and drive appropriate demand.
It’s all about optimizing inventories and gaining valuable knowledge into every corner of your supply network. Gain the insights you need with artificial intelligence, and then forecast with confidence.