![]() Merchandise planning is a systematic approach to planning, buying, and selling merchandise to maximize the return on investment (ROI) while simultaneously making merchandise available at the places, times, prices, and quantities that the market demands.Effective demand planning can improve the accuracy of revenue forecasts, align inventory levels with peaks and troughs in demand, and enhance profitability for a particular channel or product. Demand planning is the process of forecasting demand to make sure products can be reliably delivered.Demand managementĭemand management consists of three parts: demand planning, merchandise planning, and trade promotion planning. The supply chain management process is composed of four main parts: demand management, supply management, S&OP, and product portfolio management. What is the supply chain management process? Flattening the cost curve often becomes a challenge unless two factors are considered: new capabilities (process and data) that drive faster, higher-quality decisions and using a tool that scales favorably for the value it delivers for the business. Improvements to profits for the business are measured via metrics like working capital turnover or cash conversion performance as business health improves, profitable cash management and revenue conversion are the result. ![]() Increased supply chain efficiency can translate to pressure on the team and their capabilities, as costs and budgets are held flat or reduced when they’re expected to move the same or a greater volume of product at the same or a higher quality level. Higher performance is measured in terms of the efficiency of all processes and people to move goods and services to market along the supply chain. ![]() Higher performance = more cost efficiency = higher pressure? The entire business benefits through higher-order rates, positive sentiment in the customer’s mind, and lower cost-to-serve for the business. When the supply chain meets or exceeds the expectations of the customer, it’s because of efficiencies. In January 2018, Tobin Moore from Optoro pointed out this striking statistic at Retail’s Big Show: If a customer is happy with the way their return process was handled, they’re 71 percent more likely to become a repeat customer.Ī smooth return process means an effective supply chain, one that’s well connected and involves communication along the chain. Happy customer = happy business = higher performance There are two core areas where supply chain processes and procedures can contribute to business results: customer happiness and ROI. Why is supply chain management important?įocusing supply chain management on strategic activities can have a positive impact that resounds throughout the business. It includes supply planning, product planning, demand planning, sales and operations planning, and supply management. ![]() Supply chain management is the process of delivering a product from raw material to the consumer. ![]()
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