Forecasting and demand planning.

Developing a forecast of what you need to make to sell is a different proposition to doing a demand forecast, it is much more than a semantic difference.

A forecast is usually an extrapolation, sometimes very sophisticated, but an extrapolation nonetheless, of the past, and the only thing we know for sure, is that the future will be different.

A demand forecast looks at the drivers of demand, essentially looking backwards through the supply chain from the customer, and anticipating the level of demand by factoring in all the things that drive the customer to order a volume of product in any given period.

ERP systems are driven by forecasts, they are the core of any system, and the more accurately the forecast, the better the system works within the limitation of the rules written in. However, when the forecasts are informed by the drivers of demand, not just the inventory levels and automatic restocking rules in place, the value that can be delivered in vastly enhanced.


About strategyaudit

StrategyAudit is a boutique strategy and marketing consultancy concentrating on the challenges of the medium sized manufacturing businesses that make up the backbone of our economy. The particular focus is on their strategic and marketing development. as well as the business and operational efficiency improvements necessary for day to day commercial survival. We not only give advice, we go down "into the weeds" to ensure and enable implementation.
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1 Response to Forecasting and demand planning.

  1. Pingback: Lean manufacturing and Demand chains. « Strategyaudit’s Blog

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