Different Aspects of Demand Planning

Demand planning and sales forecasting is one of the key aspects of manufacturing operations. This is because manufacturing operations need to accurately estimate demand in order to produce the correct amount of goods within a given time. This includes various areas of production such as raw materials, production capacity, distribution, and others. Therefore, demand planning plays a very important and strategic role within production facilities and can aid production through cutting inventory holding cost, eliminating waste, and allowing your operation to become much more efficient. Along with the benefits of demand planning, there are aspects to consider within demand planning.

Aspects of Demand Planning

These aspects of demand planning include the following:

Statistical Forecasting - Demand planning exercises usually start with statistical forecasting. While there are various methods of statistical forecasting, with each of them catering to behaviors shown through products and markets. These models include univariate, linear, multivariate, season, and others. Determining which model to use can be a complex and time consuming process, but it is essential in order to ensure for a beneficial outcome.
Consensus Planning - The demand planning tool should be able to support consensus planning features. This is due to demand planning rarely being the work from a single department. Demand planning is a collaborative effort between various departments and it is important to make sure that the tool captures input from everyone.
Lifecycle Management - Planning for demand based on the lifecycle of the product can be complex, but not impossible. This may not be an introduction of a new product or phasing out of existing products, but rather it be replacing an existing product with a new product or multiple products. Therefore, product substitution should be a vital aspect within demand planning.

Utilizing demand planning can aid your production facility tremendously and it can be made much simpler through utilizing a software that is capable. PlanetTogether’s advanced planning and scheduling software offer demand planning components that can give an accurate representation of your future demand.