Forecasting Best Practices

2075 WordsMay 3, 20059 Pages
Forecasting "Best Practices" "Effective demand planning and sales forecasting across the supply chain can bring a host of benefits. Specifically, it can help improve labor productivity, reduce head count, cut inventories, and speed up production flows, and increase revenues and profits. -Edward J. Marien To find the "best practices" for forecasting, our team researched many cases of forecasting success, and found five companies with a common theme. Rayovac, the Coca-Cola Bottling Company, AAi. FosterGrant, the Sara Lee Corporation, and the Scotts Company all had major problems with forecasting, some of them very similar. To address and solve these problems each of these companies made major improvements to their forecasting…show more content…
Sara Lee Sara Lee has also seen improvements thanks to an updated forecasting system. Professional demand planners and updated software tools has allowed them to progress. Previously, marketing had control of sales and financial forecasts and little attention was paid to them. Therefore, high amounts of safety stock and high amounts of stockouts ensued. By developing a demand-planning group Sara Lee was able to get the appropriate people resources needed for good forecasting. They also were careful not to involve new technology that would disrupt the process already in place. With the new technology and demand planners in place, the company was able to get inputs from product managers and field sales people. With their incoming data automatically integrated into the demand planning software, they can forecast from the SKU level up to the family level. Field sales people are now being asked to forecast for the next four months for the largest customer because they have immediate access to the people and therefore, the best view of the marketplace. Forecast accuracy is up approximately 51%, and perfect order fill rates are in around 93%. Continuous improvements are now much easier to attain as they now have good metrics and can see current trends. Scotts In 1999, the Scotts Company was dominating the lawn and garden industry. The company was already leading the U.S. market, and after making a number of
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