Study 2: Inspect Demand Trends

This study can help you understand exposure in your supply chain.

Impact –

Since demand will significantly fluctuate and spike for a period of time before reverting to the mean, accurate demand signaling for the future becomes a challenge. Misreading these signals often leads to the bullwhip effect. When shoppers decide to hoard all the toilet paper from the stores, it sends a signal through the supply chain to produce more. If the toilet paper companies decide to produce more, extra inventory is pushed into the distribution channel. Inevitably, demand will stabilize and when it happens, the stores will find themselves overstocked since customers are still exhausting their previous purchases. 

Action – 

Demand trends must be studied closely and any outliers must be treated to avoid inaccurate resource planning for the future.  

How – 

AIMMS Demand Forecasting Navigator can be used to perform time-series analysis for individual product groups. Machine learning algorithms decipher the best fitting trends and promptly treat outliers so that future forecasts have increased accuracy and lower bias. 

Demo – 

Demand Forecasting Navigator Demo

This article is part of the series Immediate Supply Chain Actions to Take Amid COVID-19.