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Demand Planning & Shaping

Demand Planning & Shaping. Trade offs. The Fresh Connection is full of trade offs Over multiple roles and within roles Sometimes conflicting with role incentives. Capacity mgt. Demand mgt. Supplier mgt. Inventory mgt. Demand shaping Demand forecasting. Promotion effect. lead.

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Demand Planning & Shaping

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  1. Demand Planning & Shaping

  2. Trade offs • The FreshConnection is full of trade offs • Over multiple roles and within roles • Sometimesconflictingwithrole incentives Capacitymgt Demand mgt Suppliermgt Inventorymgt Demandshaping Demandforecasting

  3. Promotion effect lead lag P D Promotion peak baseline Promotion low Baseline = Regular sales without promotions Liftfactor= promotion peak/baseline Dipfactor= promotion low/baseline Netto effect= surface P – surface D

  4. Promotion effect - consumer and retail effect lead lag R= retail effect; goods flow from supplier to retailer C= consumer effect; goods flow from retailer to consumer PR PC DC Promotion peak DR Baseline Promotion low Liftfactor= promotion peak/baseline Dipfactor= promotion low/baseline Netto effect= surface P – surface D (=Pr-Dr=Pc-Dc)

  5. Promotion effect - implications for the supply chain • Supply Chain must first increase and afterwards decrease output to keep synchronised with sales. • Part of the additional sales is only a shift in time. P Additional sales Forward buying or cannibalisation D Promotion peak Baseline Promotion low

  6. Effect of Promotions/Sales volume rebatepolicy in The Fresh Connection

  7. The needfor a forecast stock demand tijd

  8. Demandforecasting • Why is demandforecasting important? • Reorderpoint • Demandduringleadtime • The needforsafetystocks • Orderquantity • The needforcapacity • Warehouse • Production • The needforcomponents Quantityininventory Reorderpoint Demand during lead time (DDLT) LT LT Safetystock Time

  9. Demandforecasting in TFC • Demandforecasting in TFC • Market trends • Servicelevel/OSA • Portfoliomanagement • Promotions • Relaunches • Demandforecastreflected in productioninterval tool

  10. Quality of forecasting The bias: average deviationforecast en demand over a longerperiod The mape: absolute error (%) per time-bucket 0 Explore TFC What is the Mape and Bias per finished product?

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