The terms demand planning and forecasting may sound like they are similar in nature, but are they truly? In short, while there are some similarities, they are actually different. Before you make the choice between software that provides each of these services, it’s essential to understand what those differences are and which type will best suit your needs.
Forecasting Is a Component
Perhaps the most significant difference in demand planning and forecasting is the simple fact forecasting is merely one aspect of demand planning as a whole. In general terms, demand forecasting refers to the process of determining the needs of your customers so you can accurately provide what they need when they need it most. By using both qualitative and quantitative forecasting, a company is able to determine what customers may require in the future. However, the entire process is much more than simple forecasting.
Demand Planning Requires a Holistic Approach
In order for businesses to keep up with the demands of their customers regularly, demand planning and forecasting is required. The overall process of demand planning requires a more holistic approach that looks at a vast number of factors to ensure the supply chain is operating seamlessly and retailers have access to the products they need at the appropriate time. There are many steps that are all part of demand planning, including estimating the impact of previously unmet demands, predicting underlying factors, planning for new products, monitoring sales and making adjustments based on real demand and more. Each step in this process is essential to your success.
If you’re interested in implementing demand planning and forecasting into your business, visit the Business Name website to learn more.