In our Fifth episode, we have Raghu Raghavan, Director – Marketing talking to us about Demand Planning. He will guide retailers on how to accurately predict demand and make informed Supply Chain decisions.

Transcript of the conversation:

  1. What is Demand Planning?


Today, Retailers & Manufacturers have to be well-planned. They need to create forecasts that accurately predict and shape consumer demand based on past data, current trends and supply of goods/services.

Demand Planning would equip retailers with supreme ability to economically scale to hundreds of millions of stock-keeping units without losing critical functionality. They can precisely predict demand across all product types, for example — fast and slow moving, lumpy, short lifecycle, highly seasonal, etc.


  1. Raghu, I have heard from Supply Chain professionals that Demand Planning is turning into a big mystery. What do you think?


Primarily, Omnichannel has thrown up multiple challenges to retailers and manufacturers. They have an ever-increasing number of SKUs to keep track of, immense price pressures, demanding customers who are willing to switch loyalties in a fraction of a second. Last but not the least; cater to a multitude of order fulfillment options. Overcoming these challenges requires thorough demand planning. To me all this is nothing less than a juggling act. A small drop can lead to a huge fall in the overall sales.


  1. What could be the factors effecting demand?


Generally, retailers stress on the need to improvise on prediction of demand quantities and the source of demand i.e. by region, store, and channel. But a number of factors effect demand such as:

  • Firstly, increasingly demanding customers
  • Multiple channels for ordering and order fulfillment
  • Steep rise in the frequency of promotions to increase footfalls
  • Ever-fluctuating pricing strategy requirements
  • Shortening product lifecycles
  • Lastly, seasonal changes


  1. Raghu, do you think retailers and manufacturers can master Demand Planning?


Today, if retailers and manufacturers want to be successful then they must have the ability to accurately anticipate:

  1. Which products will sell in the market?
  2. When they will sell?
  3. At what price point?

Any mismatches of demand and supply can lead to lost sales opportunities, missed profits, disproportionate expediting costs, too much or too little inventory, lost market share and unsatisfactory customer service.

Retailers should strive to align their operations with customer and end-user demand signals. Since, these are the primary drivers of making optimized supply and demand chain decisions.  They should have one synchronized view of demand across their organization.

All this requires a robust integrated planning framework that can deliver a consolidated forecast with the highest levels of accuracy.


  1. In that case, can you suggest some tools for Demand Planning?


In my experience of working with Fortune 500 Retailers, JDA’s Demand Planning is phenomenally powerful and can forecast anything.  When I say, forecasting anything, don’t think it will forecast your future. Jokes apart!

JDA Demand Planning has some awesome features like:

  • Flexible Multi-level, multi-channel forecast management
  • Automated demand classification
  • Statistical forecasting algorithms
  • Promotion and event intelligence
  • Lifecycle forecasting
  • Seasonal profiling
  • Consensus forecasting & collaboration

For example, if JDA Demand Planning is used in a retail chain, it can forecast the entire chain’s sales by store for each day of the month. Accuracy of the forecast becomes pivotal. If we can get the forecast right, everything else will fall into place.


  1. Last question of the day Raghu, could you suggest some pointers that retailers and manufacturers can put into practice for one synchronized view of demand?


Definitely! I would stress on collaboratively aligning processes and plans with their key trading partners, sharing strategic data streams on a regular basis and above all building a consensus demand plan. This way, Retailers and manufacturers will be on their way to driving defined supply chain synchronization.

We look forward to all your comments and questions.