Planners are facing increased pressure from customers for shorter lead-time, better availability, and a more varied mix of products
Achieving high customer service comes at the cost of high inventories
Better short-term forecasting is necessary to react to rapidly changing market conditions proactively
Demand Sensing vs. Statistical Forecasting
Demand Sensing leverages multiple predictive demand signals, such as: open-orders, shipments, POS data, promotions, customer inventory, and any store related data
Apply advanced learning pattern-recognition algorithms to identify recent trends and predictors of short-term demand
Sensed demand can automatically be updated every day to take advantage of real-time updates to the predictive inputs
Demand sensing is augmenting statistical forecasting, not replacing it
Demand Sensing Delivers Significant Improvements Within CPG Industry
Improve short-term forecast accuracy by 30-40%
Reduce inventory by 10-15%, freeing up cash and improving return on capital
Improve customer service by ensuring that each product is on the shelf when and where it is needed
Sense and respond to real-time market opportunities, improving promotional activity results
Demand Sensing - Benefits
Demand Sensing allows companies to get closer to the consumer by creating a better understanding of consumer behavior and its implications for the supply chain
Over the next few years, any company that wishes to maintain or expand its current market position will need to embrace a connected, real-time supply chain enabled through demand sensing
Short-term forecast decisions are critical for being able to produce and distribute products with a high customer service level, without building stockout off the roof or risking obsolescence
