In a society governed by technology, where words like Wi-Fi, internet, or smartphone are constantly repeated, it is important to question where the industrial sector stands in terms of demand planning software. Why?
Acronyms like ERP, MRP, and CRM have undoubtedly become established in the majority of companies. But a term that is gaining increasing importance is precisely Demand Planning or Sales Forecasting, which, in practical terms, are virtually the same and require the use of demand planning software for effective implementation.
But what is demand planning or sales forecasting really?
According to the dictionary, planning is defined as "a general plan, methodically organized and often of great scope, to achieve a specific goal, such as the harmonious development of a city, economic development, scientific research, or the operation of an industry." On the other hand, demand is defined as "the overall quantity of purchases of goods and services made or projected by a collective."
Therefore, we can define demand planning as "a broad, organized general plan that obtains the overall quantity of projected purchases or services."
What are the objectives of demand planning or sales forecasting?
When conducting demand forecasts, the main objectives are to reduce unnecessary costs, such as personnel, production, storage, etc. These objectives include:
- Adjusting the production needs of the company.
- Adjusting the personnel and resource needs of the company.
- Obtaining an annual, monthly, and weekly financial plan.
- Optimizing the production of references.
- Storing the necessary stock.
What are the steps to achieve effective demand planning?
As mentioned in the article "How to Define Your Demand Planning Process and its Key Steps", the procedure for obtaining reliable sales forecasts is as follows:
- Loading historical data and external variables.
- Data cleansing.
- Statistical forecasting.
- Business intelligence.
- Demand plan.
- Continuous improvement, "what is not measured cannot be improved".