Planning is an important value-added activity in the corporate value chain. While it is inevitable for any organization, certain key planning methodologies enable an organization to achieve a competitive advantage.

Planning Methodologies, demand planning net

  • Business Planning is the annual exercise of generating the Budget for the upcoming year that includes the volume, cost, and profit plan for the company. The process may also incorporate developing a long-term forecast. Learn more
  • Promotional Planning Develop the promotional plan, model the volume impact (or lift), evaluate the ROI, and incorporate the plan into the SKU-level supply chain forecast. Learn more
  • Collaborative Planning is the process of planning, forecasting, and replenishing customer supply chain needs in a collaborative relationship between the supplier and the customer. Learn more
  • VMI & CMI (Vendor Managed Inventory) are the process of managing the customer inventory and replenishing their stores and warehouses so optimal inventory is kept in the customer supply chain. The objective is to minimize stock-outs and costly production stoppages. The Co-managed Inventory Process is similar but more popular in the Manufacturer to Retailer model. Learn more
  • Account Based Forecasting (ABF) integrates the customer-specific collaborative plan into the national forecast and delivers an accurate SKU-level plan to production. The customer breakdown in the forecast can be leveraged to optimize inventories and service levels. Learn more
  • S&OP (Sales and Operations Planning) process helps the entire company to develop, understand and use a consensus forecast for operational Planning and enables a forum for understanding operational constraints and resolution to arrive at the agreed-upon operational Plan. Learn more

VMI, CMI, CPFR, and ABF are the different methodologies available for the manufacturer to collaborate with the customer. Which method to choose depends on the customer, the data availability, the systems infrastructure as well as the information needs of the collaboration process. These processes may be mapped out in a continuum of increasing complexity and benefits.

We can help you optimize these considerations and choose the right model of collaborative relationships. For more details, please contact us.