Tag: demand management best practices

demand management

A Step Towards Better Demand Management: A Round-Up of Popular Articles on Demand Management

LONDON: Infiniti Research, a leading market intelligence company, has announced the release of their new storyboard series on why demand management is the fundamental driver for business growth and strategy.

With increasing competition, market volatility, and changing customer demands, companies are facing difficulties in managing product demands and satisfying their customers. Also, instances of over-stock and stock-outs results in inventory issues. They further result in customer dissatisfaction, increased expenses, and loss of sale for the company. Finally, the end result is loss of company reputation, coupled with financial losses and customer churn. In the wake of these scenarios, most companies are leveraging demand management solution which can deal with nearly all of the above risks while enhancing their efficiency level.

Infiniti’s demand management solution has helped various organizations deal with issues pertaining to analyzing and estimating consumers’ demands and other challenges such as the availability of multiple channels and proliferating SKUs. Below we have listed some of our latest articles and success stories which will give solid reasons on why demand management solution is important for your business.

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#1: A guide to the core components of demand management: One of the common challenges faced by companies is to understand the consumer demand for goods and services that they offer. This problem does not end with understanding demand patterns and purchase behavior of customers. The actual magic lies in managing these demands accurately. A demand management process involves a wide range of components depending on the unique processes of each organization. This article discusses all the key components of demand management and their benefits for an organization.

A Closer Look at Demand Management and Its Core Components

#2: Enhancing demand chain visibility with Infiniti’s demand management solution: Stock-outs are reportedly  one of the biggest concern for businesses. For businesses that face stock-outs too often, there is a risk of losing customers. Also, it can hamper the overall growth of the company. This was the same case with a chemical manufacturer based out of US. As an organization that valued the importance of uncompromised customer service, the company approached Infiniti Research for a solution. Infiniti’s demand management solution helped the client to accurately manage inventory and enhance the customer experience.

Demand Management Solutions – How it Helped a Chemical Manufacturer Enhance their Demand Chain Visibility

#3: Healthcare providers increase reliance on demand forecasting: With demographic shifts and rapid changes in policies in the healthcare sector, predicting future healthcare demands isn’t an easy task. Our client, a healthcare company in North America wanted to improve their portfolio management ability by focusing on improving the efficiency of their services and responding proactively to market demands. Our demand forecasting solution not only supported the client to develop strategic relationships with customers and suppliers, but also enhanced collaboration to create an efficient and lean supply chain, and ultimately, a competitive advantage. Read this success story to gain detailed insights.

Demand Management: A Critical Factor in Healthcare Portfolio Management

#4: Three must follow demand management best practices for medical device companies: Medical device manufacturers often face roadblocks when it comes to making their demand management process efficient. This often results in operational inefficiency and issues pertaining to fulfilling orders. So, to help you out, our experts have unveiled some of the demand management best practices in our latest article. This article also highlights how following these practices will help you in tracking the medical devices and staying ahead of competitors.

#5: Accurately predicting sales and allocating budgets with demand management solution: Overstock of products often result in financial losses, as companies are compelled to sell the excess products at lower costs. Our client, a food manufacturing company was facing similar challenges. They wanted to leverage Infiniti’s demand management solution to predict future demand patterns and respond proactively to changing customers’ needs. Our solutions helped them accurately predict product demand and fulfill customer orders, which subsequently enhanced profit margin for the company.

Demand Management : How Infiniti Helped a Major Player in the Food Manufacturing Industry in Achieving Supply Chain Agility

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#6: What are the demand management best practices? In today’s competitive world, a number of companies are leveraging demand management solutions to meet the evolving needs of their business at every level. Demand management is a business process that enables organizations to respond to emerging situations in an effective manner by maintaining the right balance between supply and demand. This article uncovers some of the demand management best practices.

#7: Achieving average savings of $3.28 million with demand planning solutions: Today, the construction equipment market is at a crossroad. Therefore, companies in the industry are facing difficulties in sustaining their market share. Our client based out of Europe was struggling owing to the fluctuations in the market. They faced difficulties in managing the market demand, which subsequently resulted in profit losses for the company. By partnering with Infiniti Research, the client was able to survive this stiff competition and secure a spot in the European construction equipment market.

Infiniti’s Demand Planning Solution Helped a Construction Equipment Company to Achieve Average Savings of $3.28 Million

#8: Realizing savings of 27% with Infiniti’s demand and supply analysis solution: Inadequate supply and demand management can result in over-stocks or stock-outs. Therefore, it is imperative for companies to adequately forecast market demand and manage inventory. This success story highlights how one of our clients was able to achieve a 13% reduction on unfilled order and increase demand forecast accuracy with demand and supply analysis solution.

Realizing Savings of 27% in Year for a CPG Company with the Help of Demand and Supply Analysis

#9: Top demand forecasting methods for your business: Customer demands are extremely dynamic and unless organizations correctly chart out the demand patterns and ascertain the amount of goods to be produced, the chances of overstocking or understocking of goods are likely to happen. Using demand forecasting methods, companies can find what customers are buying and improvise on products that are not coping well in the market. To help such companies, Infiniti has listed the top demand forecasting methods in this blog.

3 Popular Demand Forecasting Methods to Help Your Business Reach New Heights

#10: Achieving 17% reduction in unfilled orders with demand management solution: A leading food manufacturer’s failure to anticipate the product demand not only affected their sales rate but also eroded consumers’ trust. This subsequently resulted in huge losses for the company. Read the complete success story to know the initiatives taken by our experts which helped the company in better inventory management and cost savings.

Demand Forecasting Helped a Food Industry Major Enhance Demand Chain Visibility and Reach New Heights

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demand analysis

Evaluating the Importance of Demand Analysis for Your Business

What is demand analysis?

Demand analysis involves understanding the customer demand for a product or service in a particular market. Companies use demand analysis techniques to determine if they can successfully enter a market and generate expected profits to advance their business operations. It also gives a better understanding of the high-demand markets for the company’s offerings, giving them a fair idea on which markets to invest in. Demand analysis is one of the most important considerations for a variety of business decisions including sales forecasting, pricing products/services, marketing and advertisement spending, manufacturing decisions, and expansion planning.

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Key factors affecting demand analysis

demand analysis

Common steps in market demand analysis

While there may be several methods of market demand analysis which varies according to the complexity of operations in the business, we have curated some of the commonly used steps for demand analysis:

Market identification

Identifying the specific and target market for the company’s products or services is one of the first market demand analysis steps. Surveys or customer feedbacks can be used to determine the current customer satisfaction levels. Comments indicating dissatisfaction can lead to improvements that will eventually enhance customer satisfaction. Although companies usually identify markets close to their current product line, new industries may be tested for business expansion possibilities.

Business cycle

After identifying the potential markets, the next step is to assess the stage of the business cycle in which that particular market is in. A business cycle ideally comprises of three stages: emerging, plateau and declining. Markets that are in the emerging stage indicate higher consumer demand and low supply of current products or services. The plateau stage depicts the break-even level of the market, where the supply of goods meets the current market demand. A declining stage indicates lagging consumer demand for the company’s goods or services.

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Product Niche

Once the market and their respective business cycles have been reviewed, companies will need to develop products or tailor their services to meet a specific niche in the market. Products must be differentiated from other peers in the market, so that they meet a specific need of consumer demand, creating higher demand for their product or service. It is also advisable to conduct tests in sample markets to determine which of the potential product styles is most preferred by consumers. Companies can also develop their goods in order to prevent competitors from easily duplicating their products or business strategies.

Evaluate competition

A crucial factor of demand analysis is determining the number of competitors in the market and their current market share. Markets in the emerging stage of the business cycle tend to have fewer competitors. This translates to a higher profit margin for your company. Once a market becomes saturated with competing companies and products, fewer profits are achieved and companies will begin to lose money. As markets enter the declining business cycle, companies must conduct a new market demand analysis to find more profitable markets.

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Customer needs analysis

A Closer Look at Demand Management and Its Core Components

What is demand management?

Demand management, also known as consumption management or strategic spend management, involves controlling and tracking the requirements of different business units and other internal purchasing operations. Engaging in demand management practices helps organizations to avoid gaps in supply and demand and also promote better supplier relationships. Demand management techniques also play a major role in addressing external spending factors, arranging purchase orders, and eradicating waste.

Core components of demand management

A demand management process can involve a wide range of disciplines depending on the unique processes of each organization. However, on a broader level, a demand management plan generally encompasses these core components:

Forecasting

There is more to forecasting than merely loading data into a spreadsheet, forming a basic view of projected sales based on that data, and then adjusting the business plan accordingly. Including multiple scenarios in the forecasting process prepares the company for virtually any unexpected twist or turn.

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Supply planning

Irrespective of the industry, the marketplace is highly dynamic. Furthermore, there may be constant changes in the supplier landscape, wherein new suppliers may spring up in the market or an existing supplier may go out of business. But if companies are not prepared to meet these changes and only react when they occur, chances are that they may get left behind among the other players in the market. By maintaining deep visibility into the capabilities and business health of all the suppliers, organizations can be positioned for continued success irrespective of what happens in the global business climate.

Demand analysis

Basing the demand decisions only based on the sales data may be a huge mistake for companies. Most ERP systems record sales based on when a product has been shipped and not based on when it was first ordered. Only by keeping an accurate view of order history can they paint a realistic picture of the company’s demand—and then strategize on ways to meet that demand year after year.

Sales and operations planning

The idea that the supply chain organization can operate in a silo, free from the input of executives is outdated. Over the past two decades, organizations that make and sell products have embraced sales and operations to involve a wider range of stakeholders in every supply chain decision—and to incorporate supply chain information and needs into every business decision. 

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Demand management

Demand planning vs demand management

Demand planning is the process of forecasting consumer demand for a company’s products or services well into the future. It is usually associated with sales, but it is closely tied to supply planning, which seeks to ensure that a company has enough supplies to meet the market demand. Ideally, a company’s demand-planning process helps maintain supply levels that meet demand or just slightly exceeds demand.

Demand management, on the other hand, is similar to demand planning, but demand management looks at consumer demand in the short term. Demand management is the oversight of current consumer demand to ensure that a business does not experience any loss of profits. Demand management is much more capable than demand planning when it comes to taking advantage of business opportunities in response to local events.

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What Are the Demand Management Best Practices That You Must Follow?

Demand management is one of the critical business processes for boosting revenues. Today, a large number of companies are focusing on developing the tools for this management. Two very important factors, namely customer retention, and company financial performance, largely depend on its management. As a result, the need to adhere to demand management best practices for improving the overall performance of the business for the end-to-end supply chain has increased. It also provides a solution for all the functions that are affected by the demand management process. But before digging deeper and explaining how to improve your demand management processes, let’s understand the concept of demand management.Ask An Analyst_IR

What is demand management?

Demand management is not a statistical forecast, but it is a process that supports the objectives of an organization. It adheres to the tenets of best practices. It involves the review of demand projections using a method called “management by exception”. It is the development, reporting, and finally publishing of appropriate metrics of error that reflect the perfect business environment.

What are the core components of demand management?

A good demand management system must include the following components:

  • The engine of the statistical forecast that consists of both quantitative and rule-based methods
  • Management interaction that includes qualitative methods and management by exception
  • The system of performance management that includes feedback, publication, and accountability
  • Information organization that has visibility into data and analysis capabilities through graphs

Demand management best practices

Effective management of demand is essential for the profitability of a company. It is a business process that enables all organizations to respond to emerging situations in an effective Request Proposaland efficient manner by maintaining the right balance between supply and demand. This can be achieved by following some of the best practices, which include:

Identifying and focusing on the objectives of management

This practice includes the following:

  • Inventory reduction
  • Maintenance of customer service levels
  • Monitoring inventory of unavailable or discontinued items
  • Proper pipeline fill of new arrivals
  • This management process should be consistent across the enterprise
  • Assigning ownership of the process
  • Identifying and including organizations in the process that are impacted by the plan of demand
  • Implementing a consensus and collaborative procedure
  • Defining accurate points of aggregation to support objectives of the organization
  • Identifying the frequency and timing of the forecast review cycle

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The practice of defining forecast management by exception

  • Identify appropriate measurements of error forecasting
  • Implement a procedure to disseminate the result of forecast
  • Review the complete demand management process procedures regularly for improving accuracy, performance, and efficiency

Determine and implement tools to support the process of management

  • Statistical forecast methods must be followed including rule-based methods
  • Error metrics must be examined regularly
  • Reporting methods should be followed for accurate results.

To know more about the best practices

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