A well-known beverage manufacturer based out of the United States faced several predicaments due to the use of inaccurate demand forecasting models. The implications of their inaccurate demand forecasting methods resulted in a sharp dip in the revenue generated from the alcoholic beverages segment. This is when they approached Quantzig to leverage its demand forecasting and production planning expertise to improve its existing sales forecasting process and forecast accuracy.
The Business Challenge
Aligning the long-term strategic goals of your organization with performance measures and market demands has never been easy. Trying to aggregate real-time demand and inventory stocks across the entire supply network requires not only a strong analytic platform but also prompt and reliable data that can help organizations to gauge the market demand. Being able to precisely predict or forecast demand across industries, often requires a significant amount of effort and analysis across disparate data sources and forecasting models.
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Many organizations have aggressive performance goals related to delivery time reliability, demand management, inventory optimization, order fulfillment rate, order cycle time, and inventory turnover but are unable to accurately forecast demand and the factors affecting them. The ability to effectively forecast fluctuations in demand is crucial to the success of an organization. The use of appropriate demand and supply forecasting methods is especially crucial in the food and beverage sector as accurate forecasts lead to faster cash turnover cycles, lower inventory cycles, and quicker response rates. The client a leading alcoholic beverage manufacturer was looking at using demand forecasting models to optimize their production planning process and enhance the demand forecasting accuracy.
Solutions Offered and Value Delivered
Quantzig identified that the inefficiency in the client’s demand forecasting approach was resulting in inventory pile-ups and frequent stock outs for some SKU’s leading to a huge loss in revenue. To help the client address such challenges the experts at Quantzig developed a demand forecasting model to help them better plan their production process. Though the demand forecasting model initially focused on top-selling SKUs’, it was later expanded for another set of SKUs’ for which the client faced similar issues related to demand forecasting.
Detailed analysis and visualization of demand can help your organization achieve higher targets. Learn more about our solutions and stay well-equipped to resolve your inventory issues.
The demand forecasting solutions also enabled the client to:
- Improve prove demand forecasting accuracy across different region-SKU combinations
- Visualize the demand, forecasts, and accuracy metrics for different SKU’ through interactive dashboards
- Reduce the forecast generation process time by 75%