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Home » Custom/Hybrid Programs » Distribution Forecasting
Distribution Forecasting
Scientific Approach to Distribution Forecasting: Proven Methods, Tools, and Techniques.
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Program Overview
The number one cause of inventory in any supply chain is forecast error. Forecast error is also the number one cause of stockouts for supply chains as well. Most distributors, therefore, consider forecasting to be the most significant problem facing distribution. Forecasting is carried on at all distribution outlets everyday. No purchasing or transfer decision is made without consulting a forecast no matter how rudimentary that forecast may be. This course will equip you with the required strategies to deal with forecasting challenges and facilitate making cost saving decisions during the replenishment process.
Learning Objectives
This program will address:
- Cost of ineffective forecasting?
- How to implement Inventory Stratification based Forecasting system?
- How to set / customize forecasting parameters and policies?
- How to address data definition, extraction and integrity issues?
- How to interpret forecasting results and take actions?
- How to measure and improve forecast accuracy?
Program Outline
Distribution Forecasting Overview
- Forecasting Principles
- Role of Stratification in Forecasting
- When to forecast?
- Holding Cost and Stock out cost of inventory
- Demand classifications
Distribution Forecasting Process
- Forecasting Game
- Forecasting parameters and policies
- Forecasting: New Products, slow moving, lumpy demand & replenishment products
- Human Review Process
- Impact of Forecasting on Replenishment
Forecasting Data
- Data Definition – Demand buckets, History length, etc.
- Data Extracts – Location, Item and Transaction attributes.
- Data Integrity – Divide by Zero, Negatives, Unit of Measure issues, etc.
Forecasting Methodology
- Forecasting methods
- Appropriate use of mathematical models
- Methodologies for normal vs. slow-moving inventory
- Forecasting for a Distribution Center (DC) vs. Branches.
Forecast Measurement & Improvement
- Defining and Measuring error metrics
- How to improve forecast accuracy?
- Multi-dimensional views and interpretation of forecasting results
Fine Tuning and Enhancing Forecasting
- Sales input to Forecasting
- Customer input to Forecasting
- Financial benefits of accurate forecasting
Key Takeaways
- Better understanding of Scientific Forecasting Principles
- Stratification driven Forecasting parameters and policy settings.
- Insights into common data integrity pitfalls & how to avoid them.
- Understanding the right forecast model for your business environment
- “What products to forecast” and “What products not to forecast”?
- Determining the appropriate data that needs to be used for forecasting
- Forecast error measurement methods and tools to improve them.
Benefits
- Understand what and how to forecast
- Learn how to customize methods, parameters & policies using real-world examples.
- Gain insight into data issues to improve accuracy of forecasts
- Realize ROI on scientific forecasting methods, tools and techniques.
Who should attend?
- Distribution Managers
- Branch & Regional Managers
- Planners and Buyers
- Purchasing Professionals
- Distribution Operations Professionals
- Potential operations and management employees
- Management or Operations Trainees
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