What is demand planning?
Demand planning is the process of forecasting the demand for a company's products or services.
Its objective is to ensure the best possible estimate of actual customer demand to drive supply, sales, and financial planning processes
Effective communication channels must be established to share information and align forecasts.
Cross-functional collaboration is essential for effective demand management and the creation of a... Cross-functional collaboration is essential for effective demand management and the creation of a consensus across the sales, marketing, planning, and finance functions.
The Demand Planning Process
1. Data Collection and Analysis
It begins with the collection of relevant data and ends with its analysis
2. Demand Forecasting
Based on the data obtainedBased on the data obtained, companies can estimate the quantity of product they need to sell in a given period
3- Demand Plan Creation Once the forecast is complete, a consensus demand plan is created, indicating which products must be manufactured (or purchased, if the company is solely dedicated to distribution) and in what volume.
4. Performance Monitoring and Adjustments
Finally, key performance indicators (KPIs) are established to evaluate the process's effectiveness and improve future forecasts.
For more details, watch the video below:
