Demand planning helps establish an accurate Reorder QuantityThe recommended quantity to purchase, visible in the Projected Purchase Order. It's calculated based on a variety of factors, including the product's forecast formula, order commitments, and the number of weeks set in the projection. (ROQ) which ultimately drives suggested purchase quantities for Projected P/Os.
You will need to plan for SporadicA product that has demand in less than 8 months of the previous 12 completed months. An accurate forecast formula cannot be applied to products with little demand. Alternatively, the mode (or if there is no mode, then the median average) of previous sales quantities is used. It can be overridden by setting a Max Stock Quantity. Demand as well as UnusualProducts that have demand in a particular period that exceeds or falls below the system forecast. It is largely influenced by product rankings. For example, C or D ranked items are slow movers, and it is unusual to sell them in a high volume. For faster moving A or B ranked items, it may be "unusual" to see a big drop off in sales. Demand.
Products with sporadic demand are those that are sold infrequently. To forecast ordering for sporadic demand, Inform first tries to identify the ModeThe most common quantity ordered over the last 12 months of demand. from the last 12 months demand, and if there is none, then uses a Median Average DemandThe middle number of the product's demand. If over the course of a year, the demand was 1,2,1,2,3,1,2,2,2,1,3,2, then the median is the average of the middle two months (6th and 7th), which is 1.5. Inform would round that up to 2. of the previous sale quantities to determine the ROQ with a goal to keep enough in stock for most sales without over ordering. Review these products with Sporadic Demand and override system suggestions by setting a Max Stock QuantityMaximum Stock Quantity. The highest quantity to keep stocked at all times. If the available inventory falls below this, the product will appear in Projected Purchase Order..
Unusual demand patterns can lead to a skewed ROQ, as formulas are based on demand. Such patterns may include one time purchases from customers or a downward trend in a traditionally fast moving product. Review these products with Unusual Demand and correct exceptions by setting an AdjustmentAllows the demand exception to be overridden and set to a more appropriate level. The updated demand will lead to a more accurate reorder quantity..