Demand Planning

Client / Profile:

Computer Ink and Toner consumable department within a National Retailer with 100 stores, supplied by the wholesaler direct to store.

Issue:

Low stockturns, Store out of stocks for products that were overstocked nationally.

Cause:

Promotional Forecasts were generally over zealous, as sales staff were not accountable for the value of stock on hand.

On the flipside non-promoted product received negligible attention to Forecast accuracy and therefore were too often out of stock at individual stores.

Response:

Implemented MerciaLincs ® Demand Planning system to create a highly accurate base forecast. Held sales accountable for promotional forecast accuracy. Implemented monthly forecast reviews across the whole product range (a version of Sales & Operations Planning). Moved the safety stock calculations from Static to dynamic modelling.

Outcome:

• Stockturns increased from 4.1 nationally to 9.7.
• In Stock availability increased from mid 80% to over 98.3%
• Sales personnel time was significantly reduced

Learning:

High volume end consumer demand should be extremely predictable.