3 Advantages of Demand Planning

12/10/18 12:51 PM

Demand planning is the process within supply chain management that accurately analyzes any current and future projected demand, which will then create forecast for production to utilize. Demand planning has become an integral part of production facilities that are looking to further enhance their overall supply chain. Advantages of Demand Planning It is essential for your business to conduct this process in the most in-depth and detailed manner. Without doing this, you are lessening your chances of a more accurate outcome. Before utilizing the demand planning process, it is beneficial to understand the advantages of the process. Therefore, here are the advantages of demand planning.

Advantages of Demand Planning

The advantages of Demand Planning include the following:

    • Product Forecast Accuracy Improvement - Effectively forecasting product production can provide thorough insight into expected revenue. An example of this would be when a company has consistently forecasted too many products for a a monthly promotion, a company can allow for two things - establishing a framework to investigate previous forecast and adjust these forecast based on actual company data. Overall, the importance of this is monumental considering that a substantial amount of revenue is lost due to over and understocking.
    • Scheduling Increase - By predicting when sales are likely to happen, businesses can better plan production, warehousing, and shipping scheduling. In order to conduct these mandatory maintenances in a cost effective manner, you must avoid any time period when there are a high amount of orders. This will save time and money in the long run and prevent any loss in revenue due to maintenance/reboots.
    • Optimize Labor Management - When there are too few workers when there is a high demand for a product, your business may experience a decrease in fulfilment time along with average order completion per day. Being able to fulfill customer orders on time can hinder relationships, which is why it important to ensure for product to be on hand ready to go without high inventory cost. Demand planning will allow for insight through getting a more precise understanding of how much product to produce within a given time period.

A software that can aid in demand planning is advanced planning and scheduling (APS) software. Advanced planning and scheduling software has become a necessity among manufacturing operations around the globe and has led to manufacturing efficiency increase with ease.

Advanced Planning and Scheduling Software

Advanced Planning and Scheduling (APS) software has become a must for modern-day manufacturing operations due to customer demand for increased product mix and fast delivery combined with downward cost pressures. APS can be quickly integrated with a ERP/MRP software to fill gaps where these system lack planning and scheduling flexibility and accuracy. Advanced Planning and Scheduling (APS) helps planners save time while providing greater agility in updating ever-changing priorities, production schedules, and inventory plans.

    • Create optimized schedules balancing production efficiency and delivery performance
    • Maximize output on bottleneck resources to increase revenue
    • Synchronize supply with demand to reduce inventories
    • Provide company-wide visibility to capacity
    • Enable scenario data-driven decision making

Implementation of Advanced Planning and Scheduling (APS) software will take your manufacturing operations to the next level of production efficiency, taking advantage of the operational data you already have in your ERP.


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