In the business industry, demand planners are like the unsung heroes; they often less get the well-deserved credit for doing their job and keeping a business thriving and competent but nevertheless, they always play the crucial role and delivers clutch performances whenever they are needed but just like other professions, they also have to hurdle several challenges in their careers.
Demand planning is a tough job that needs a person who is willing to take risks in forecasting business developments despite facing uncertainties and circumstances along the way. For this article, I will show you the toughest challenges a demand planner faces on a regular basis whenever they are on the field. A lot of retail companies learned that demand planning is challenging because they prioritize how they are accepted generally in the business sector as the people who improve the cost-effectiveness and availability in the supply chain.
Demand planners forecast the company’s new product or business as some sort of product introduction have become a vital aspect of the product’s life-cycle as it shortens and assortment as the turnover increases. This is challenging for demand planners particularly in the specialty retail sectors like fashion, electronics, and cosmetics where the newly introduced products that come only in seasonal assortments account for the bulk of its sales. In the bookmaking industry, ninety percent of its items are being sold as good as new in that year, that is why forecasting this kind of product must be done right so that it will be manufactured and produced according to the demand.
Traditionally, demand planners have a method of stocktaking which was proven to be ineffective and inaccurate when it comes to fetching data. Inventory forecasting as well as demand planning has becoming difficult every time the stock levels are hard to monitor or it has become lesser visible to them because of their inability to access stock level reports of the business or company that they handle which can quickly result to unnecessary excess stock levels that might affect the demand levels of the product they are monitoring and forecasting.
Demand planning is usually based on the previously recorded sales data and having difficulties accessing some of it makes it difficult for demand planners to come up with a forecast or predict sales and demand of the product especially for the products that are seasonal varieties which may result to overproducing or shortage in demand.
CALCULATING LEAD TIMES
Demand planners are the ones who also calculate the lead time to fulfill the needed orders from their inventory that must be taken into account. It has proven that the method named “Just In Time” or JIT is less effective and causes delay order fulfillment that results in sales loss and account cancellations.
The excess stock and the inventories obsolesce could have been easier to prevent rather than being eliminated. Demand planners need a centralized system that can help them prevent any costly ordering or manufacturing of products to also get the reliance from the suppliers and vendors to prevent inventory redistribution from multiple stock locations.