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Demand Planning and Sales Forecasting ServicesAt Forecast Solutions we offer a wide range of services related to demand planning and forecasting, with a particular interest in seasonal analysis and sales forecasting methods, including time series projection and causal analysis. A range of of demand planning training is available. In time series forecasting the aim is to understand historical demand patterns for the thing we wish to forecast, including trend and seasonality, then project forwards to create a sales forecast. A large number of methods are available to acheive this and it is often the case that simple methods are just as effective as the more complicated ones. In many companies it is more important to deal effectively with seasonality and promotions than to worry about complicated statistical methods. Causal analysis is somewhat different. Here we endeavour to identify and quantify the causal factors that affect the business, whether that be price or price index, weather, economic indices or any other factor. At Forecast Solutions we use specialist statistical software for this type of analysis. If valid relationships can be quantified they can be used in the formulation of business strategy and in demand forecasting. If necessary we include time series forecasting elements as well, in order to keep pace with changes that may be due to other, unknown, background influences. An outline of some of our main services including forecasting training courses is given below. For further details please visit our key services page. or feel free to contact us by email at enquiry@forecastsolutions.co.uk.
Demand Planning and Forecasting TrainingDemand planning and forecasting training is a major part of the Forecast Solutions offering. The aim is to provide demand planning courses that are practical, but sufficiently detailed to impart a good understanding of the basic principles and the most important methods. Our forecasting courses are geared to be relevant, regardless of any specialist software that the company may have, but Excel is used as a common language for the worked exercises. The Introduction to Sales Forecasting course explains the three basic approaches to demand forecasting. It goes into detail on a few of the most common methods and covers forecasting for new products and promotions. For those who wish to go into greater detail there is the Advanced Forecasting Course. This follow-up training builds on the work done in the introductory day. There is not a fixed format for this, the content and level of detail being geared to meet individual needs. The 2 day Demand Planning and Forecasting Workshop gives a good amount of detail on forecasting methods plus some aspects of supply planning including inventory policy, safety stock calculation and an introduction to sales and operations planning. Time Series ForecastingMany sales forecasting systems rely on the simple forecasting methods of time series projection, thus analysing sales trends and seasonality in the history and projecting into the future. Both curve fitting and the commonly used exponential smoothing methods fall into this category. In medium term forecasting, such as for sales and operations planning, it is important to reflect product life cycles and expected changes in the competitive and technological environment. On the other hand short-term forecasting is more to do with detailed tracking and management of short-term demand in order to minimise inventory and maximise customer service. Monthly forecasting is good for many businesses and is the most straightforward platform for dealing with seasonality. Many consumer goods companies, however, find that weekly forecasting is a better basis for dealing with an active promotional programme. Sometimes daily forecasting is necessary for the forecasting of short shelf-life products and for call centre forecasting. Causal Analysis including Pricing ModelsDemand is often affected by causal factors such as price relationships, unseasonal weather or economic indicators such as GDP. It can be highly beneficial to carry out analysis to validate the importance of suspected factors and to quantify their effects. Such causal modelling can be an important element in the overall forecasting solution and can help define pricing and other business strategy. Forecast Solutions is expert in statistical analysis to examine vital areas like price sensitivity and the effects of economic leading indicators such as disposable income and gross domestic product. Unseasonal weather can drive significant changes in demand, so a study to quantify the effect of weather on sales can be very helpful for sales forecasting. Forecasting Process ImprovementWe can help in all aspects of developing an excellent demand forecasting process. The first step is usually to understand current methods and assess how successful they are in meeting business objectives. The aim then is to identify improvements that can be made involving the forecasting infrastructure, methods and processes, with a view to improved forecast accuracy going forward. If there are significant benefits to be achieved by consideration of new or improved forecasting software, Forecast Solutions is well placed to help. FMCG Forecasting and PromotionsThe presence of past promotional activity in the historical data that is to be used as the basis for demand forecasting can cause problems in FMCG forecasting. It affects seasonal analysis, choice of forecasting model and setting the correct level of forecast demand. Therefore the sales history often needs to be cleansed of promotions before it is submitted to statistical forecasting. Then there is the question of how to approach promotional forecasting going forward. If promotions have occurred frequently in the past, a good option is to try to build promotional profiles through analysis of previous promotions. Otherwise a more manual approach may be needed. Sometimes it is helpful to keep the promotional forecast separate from the baseline. Seasonality in ForecastingFinding the best way of dealing with seasonality in forecasting is an essential element in sales forecasting for many businesses and can sometimes dominate the forecasting task. Seasonal analysis becomes harder as the data becomes more detailed, so it is often useful to use a GSI (group seasonal indices) approach. Smaller time buckets also make the calculation of seasonal indices more difficult and the task is a lot more difficult with weekly as opposed to monthly forecasting. This sometimes contradicts an intention to improve forecast accuracy by forecasting in smaller time buckets. Forecast AccuracyImproved forecast accuracy is vital in short term sales forecasting in order to lower stock levels, reduced operational costs and provide better customer service. For medium term forecasting, such as that needed for sales and operations planning, an accurate forecast is essential for best business and financial planning. Forecast Solutions can advise on methods for forecast accuracy measurement including MAPE and WMAPE and can help with the development of suitable accuracy reports. | ||