Improving forecasting accuracy through TPM
Forecasting is a keyword for most retail suppliers. The simple reason for this focus on forecasting accuracy is that the better you are at guessing or forecasting the final quantity the consumers are buying through the retailer’s shops, the more money you can make for both the retailer and yourself.
- Key Account Managers use accurate POS data to forecast future promotion volumes
- Promotions have accurate delivery dates and promotion dates
- Baseline I automated based on POS data, trends, and seasonality
I will provide you with eight small improvements that can be made using effectmanager. These small improvements optimize your internal processes which can help you improve your forecasting by focusing on trade promotion management. However, any supplier to retail can use these eight small improvements to improve their own forecast. Not all the improvements are quick-fix solutions. By starting to involve the Key Account Manager in a good trade promotion evaluation process and daring to take that follow-up dialog with the retailers, it is a great first step to improving your forecast accuracy.
Cooperation is key
Most large companies have Demand Planners or Buyers, who are responsible for the quantities produced or purchased to the finished goods warehouse. They have a great deal of knowledge about production cycles, lead times, and every other trick in the book to optimize the supply chain. But they lack knowledge about the customer.
Equally, most large companies have Key Account Managers, who negotiate promotions and other trade terms with the retailer. They plan the future range and discuss the prices to match the requirements of the consumers who are ultimately buying the products off the shelves. In other words, they know everything your company must know about the customer.
It is not always easy to get the information from the Key Account Managers to the Demand Planners, but if you are willing to make some changes to your internal processes, it is possible to get Key Account Managers and Demand Planners to work together in the trade promotion planning and thereby improve forecasting accuracy.
Effectmanager is primarily an online account management software platform for Key Account Managers to optimize their trade promotion management. If they use the findings from the evaluation of trade promotions to optimize planning in effectmanager, they already have the best estimate of the quantities needed for the promotion. If this information is communicated to Demand Planners, there is a good basis for improving forecast accuracy.
But how can we combine the knowledge from the Key Account Managers with the Demand Planners and improve our forecasting accuracy?
The eight small improvements recommended by effectmanager must be applied to your internal knowledge sharing to improve forecasting accuracy.
Not all the improvements are quick fixes, but you must start by involving the Key Account Manager in good promotion evaluations and dare to take that dialogue with the Retailers.
If you think this sound interesting, and you would like to know, how effectmanager can help you improve your forecasting accuracy, we will contact you, if you fill out this form.
Sincerely,
Jan Meldgaard
CEO effectmanager
Do you want to know even more about, how effectmanager can help you optimize your internal processes to improve forecasting - you can download my whitepaper on Forecast Accuracy here.
