Enhancing the Demand Planning Process with POS Forecasting

EnhAncinG thE DEMAnD PlAnninG ProcESS with PoS ForEcAStinG By John A. Gallucci and hugh J. Mccarthy T T he concept of utilizing Point of Sales (POS) data to generate accurate order forecasts defines the next significant competitive advantage in demand planning and supply chain efficiency. Leading consumer product goods (CPG) innovators are already using this data effectively, while others are either defining how to use it, or are just now gaining access to it. The retail and CPG industries show multiple examples of huge activity around this concept. 1. Initiatives such as Collaborative Planning, Forecasting and Replenishment (CPFR) and Vendor Managed Inventory (VMI) have evolved to the point where POS is a central focus in crossentity discussions. 2. Some CPG companies have deployed demand planning resources onto field sales teams to harness this information. 3. Companies that supply syndicated POS data are more in demand than ever. 4. Demand Planning software companies are now building applications to deliver a bridge between POS and order forecasts (projected orders to be placed by retail customers). It is worth exploring why POS information is so valuable to the demand planning ...