Consumer brands continue to navigate an evolving market, and this volatility has further underscored the role of demand planning in a successful supply chain strategy. Effective demand planning helps businesses forecast future demand, minimize inventory costs, and improve customer satisfaction. While managing demand planning in-house is an option, hiring a managed service provider can offer significant advantages.
Continue reading below as we explore why hiring a managed service provider for demand planning is immensely valuable, and what to look for in a provider of managed services for demand planning.
Benefits of working with a demand-planning service provider
Hiring a demand-planning service provider offers several advantages over performing demand planning in-house, including improvements in demand forecasting accuracy, process efficiency, proactive decision-making, strategic team focus, customer satisfaction, inventory cost management, and lost-sales reduction.
Demand-planning service providers have a wealth of experience and domain-specific expertise in demand forecasting and supply chain management. They leverage this knowhow to help businesses optimize their operations and improve their bottom line.
The best demand-planning partners have access to advanced analytics tools and machine learning algorithms that can help them analyze data in real-time, identify patterns, and make more accurate forecasts. This can help businesses make better-informed decisions about inventory, production, and logistics, leading to cost savings and increased customer satisfaction.
By outsourcing demand planning to a supply chain service provider, businesses can free up their internal resources to focus on more strategic tasks, such as analysis, forecasting, and decision-making. This can help businesses stay ahead of the competition and make more informed decisions.
Finally, demand planning service providers offer scalability, which means they can easily adapt to the changing needs of a business. This can be particularly useful for businesses that experience sudden spikes or dips in demand, as the service provider can quickly adjust the forecasting models and supply chain processes to accommodate these changes.
By outsourcing demand planning to a service provider, businesses can focus on their core competencies and leave the demand planning to the experts. However, it’s important to choose the right service provider to ensure that you get the most out of your investment.
Key features to look for in a demand-planning service provider
When searching for the right demand-planning service provider, it is crucial to look for certain features and capabilities that will help you achieve your business goals:
- Expertise in demand forecasting
A good demand-planning service provider should have a team of experts with experience in demand forecasting. These experts should be able to work with your business to identify the right data sources and develop accurate demand forecasts that can help you make informed decisions.
- Ability to integrate with existing systems
The demand-planning service provider should have the ability to integrate with your existing systems, such as your ERP or CRM software. This will allow for seamless data transfer and enable the provider to incorporate relevant data into their demand forecasts. It will also make it easier for your supply chain execution platform to receive and act on these forecasts.
- Use of analytics and machine learning to improve forecasting accuracy
Demand-planning service providers should use advanced analytics techniques and machine learning algorithms to improve the accuracy of demand forecasts. By analyzing large volumes of historical data and using machine learning algorithms, the provider can identify patterns and trends that can be used to predict future demand with greater accuracy.
- Regular review and curation of machine-generated forecasts
The best demand-planning service providers have both demand planners and data scientists on their team. These experts regularly review and curate machine-generated forecasts to ensure they are accurate and relevant. This review process helps eliminate anomalies and outliers, and ensures that the final demand forecast is reliable.
- Real-time advanced analytics for informed decisions
The demand-planning service provider should be able to provide real-time data and advanced analytics capabilities to support informed decision-making. This includes access to dashboards and reports that provide insights into demand trends, inventory levels, and other relevant metrics.
- Customization to fit the specific needs of the business
Each business has unique demand-planning needs, and the demand-planning service provider should be able to customize their services to fit these specific needs. This could include developing custom forecasting models, integrating with specific software applications, or providing additional consulting services.
- Scalability to support business growth
As your business grows, your demand-planning needs will change. The demand-planning service provider should be able to scale their services to support your growth, whether that means increasing the frequency of forecasting or incorporating new data sources.
By considering these key features, you can narrow down your search and find a demand planning service provider that will help you achieve your business goals.