Don’t want to keep throwing money away?
Billions of dollars flow through businesses every year that ends up going right in the trash. How? Because companies either have too much inventory sitting on shelves or not enough to keep up with customer demand.
Sound familiar?
If you’re currently “guessing” at demand planning, then your business falls into one of these two categories.
Let’s take a look at how much money is lost each year due to poor inventory management:
Inefficient inventory management costs businesses $1.1 trillion globally each year. Yep, you read that correctly.
Trillion.
With better demand planning solutions, you’ll have all of the data you need to know what to order, how much to order, and when to place those orders.
There’s no more guessing for you.
Here’s what you’ll learn:
- Inventory Management Is Failing Businesses
- Demand Planning Tech Stack
- Transforming Demand Planning With Artificial Intelligence
- How to Build Your Demand Planning Solution
Inventory Management Is Failing Businesses
Think about how you manage inventory levels today.
Outdated spreadsheets? Luck? Best guesses based on prior years sales?
Many businesses do this today.
But here’s the problem with this method:
Customer demand shifts rapidly. Supply chains are unpredictable. Trends pop up overnight.
When a business can’t react quickly enough to demand (especially when it suddenly shifts), they are left with one of two options:
Large amounts of dead inventory… or empty shelves.
Neither are ideal situations for any business.
Excess inventory means huge markdowns and sunk costs. Lost sales means unhappy customers who will never return.
Luckily there’s a solution.
Technology solutions that specialize in demand planning utilize real-time inventory levels and sales forecasting to help businesses predict which products are going to sell and when.
With accurate demand planning with Netstock, businesses can order enough inventory to meet shopper demand without overstocking on unwanted products.
Eliminating waste while keeping customers happy? Yes, please.
Demand Planning Tech Stack
As with anything in life, building a successful demand planning solution takes a combination of different tools and technology working together.
One tool won’t cut it.
Think of it this way:
You have a basketball team of pieces that need to accomplish a common goal.
Each piece has a job to do. When everyone works together, magic happens.
Demand Planning Software Stack Includes:
- Demand Forecasting Software
- Inventory Management Solutions
- Supply Chain Visibility Software
- Analytics Software
How do these four pieces work together to improve your demand planning process?
Demand forecasting software does just that. Predicts future demand based on historical data, market trends, and seasonal fluctuations.
Inventory management systems keep track of how much stock you have and where that stock is located. No more guessing or pulling late-night pulls.
Visibility tools connect your suppliers, warehouses, and storefronts together so everyone has access to the same information.
Finally, analytics software and dashboards turn all of your data into insights your team can actually understand and use to make data-driven decisions.
When these tools all integrate with one another, that is where your business will start to see massive improvements.
Transforming Demand Planning With Artificial Intelligence
Artificial intelligence (AI) has revolutionized demand planning as we know it.
Old school forecasting looked at past years sales and attempted to predict future growth by adding a percentage of sales. AI takes it much deeper than that.
Machine learning algorithms can:
- Process thousands of data points at once
- Identify patterns humans overlook
- Continuously adjust forecasts based on outside influences
- Learn from past mistakes to improve accuracy overtime
When you factor in AI, your forecasts will be far more accurate than your business has ever seen.
On average, poor inventory management causes businesses to lose up to 11% of annual revenue. AI powered demand planning solutions minimize this number by being right more of the time.
How to Build Your Demand Planning Solution
Thinking about taking your demand planning to the next level?
Before you begin buying software, take a step back and look at where your business currently stands.
What software are you currently using? Where are you losing money? What metrics matter most to you?
Start here.
Then implement these steps to start creating a tech stack that will work for you and your business.
Here are 5 steps to build your demand planning tech stack:
- Audit your data. You can have all of the fancy software in the world but if your data is dirty, it won’t do you any good. Start here.
- Determine what tools you need to integrate with. Your demand planning tech stack won’t live in a silo. Make sure everything you purchase can integrate with your ERP, POS, ecommerce platforms, etc.
- Implement a forecasting solution. Want to see results quickly? This is your fastest ticket to ROI. You’ll be able to make better inventory decisions almost immediately.
- Layer in visibility. Once you have your forecasting in place, you can start adding levels of visibility. Tie your suppliers, warehouses, and stores together so you can see everything in real-time.
- Implement analytics. Now take all of that data and use it. There’s no sense in having all of this information if you can’t understand it. Analytics software will help you sift through the data and make better decisions for your business.
Start small and scale as you see successes.
Gain A Competitive Advantage
The businesses that have already implemented strong demand planning technology will soar above the competition.
They don’t have excess inventory tying up cash. They have happier customers that get what they want when they want it.
Sound nice? It is. And companies are already seeing these benefits from using demand planning solutions.
When you’re not overstocking on inventory, everything runs more smoothly.
You know exactly what your suppliers need to send and when. Warehouses don’t have to spend as much time processing shipments. Your sales teams can promise the sky to customers because you know you’ll have enough stock to fulfill those orders.
Companies that aren’t implementing these technologies are left guessing.
They are over-ordering to ensure they don’t run out of stock. They’re spending more money on storage. Their customers can’t find what they want when they want it so they go somewhere else.
Someone has to lose, and it won’t be you.
Wrapping Up
Stop losing money by knowing EXACTLY what your customers want and when they want it.
Revenue should not be going to waste. There’s too much money on the line.
The demand planning tech stack helps businesses leverage historical data, sales forecasts, inventory levels, and market trends to build a smarter way of managing their supply chain.
With the help of AI and machine learning, your business can start righting the ship and start profiting rather than losing large amounts of money to dead inventory.
Here’s a quick recap:
- Old school inventory management won’t cut it
- Demand planning requires a tech stack of integrated tools working together
- Artificial intelligence delivers better results
- Implement new technology in phases.
- Companies with strong demand planning tech stacks leave the competition in the dust.
Once you embrace what technology can do for you, there’s no going back.
Companies that haven’t adjusted to these changes are still guessing when they place orders.
Guessing leaves room for error. And that error equals dollars lost.
Don’t be that business.
Implement tech into your demand planning process and watch your profits soar.
