| Promotion Planning and Management
The Problem
If you sell directly to consumers in dynamic retail markets, or are a manufacturer that sells to companies that do, you know sales are influenced by many factors—trends, seasonal cycles, the weather and your own promotions. If your forecasting and planning system cannot isolate and measure the effect of all these factors, you will never be able to accurately predict demand. The result is an entire supply chain out of sync with the rhythm of the market and the beat of your own promotional activities.
Unfortunately, most promotion planning and modeling systems available today are short on the flexibility and horsepower necessary to predict the varying effects of different promotions on different product items. While they may allow you to assign a single promotional scenario to one or all of your product items, you may need to manage multiple promotional scenarios applied to thousands of individual items in your database. And their ability to correctly integrate the promotional effects with those of other factors affecting future demand is often missing.
The Smart Solution
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| SmartForecasts’ powerful promotion planning and event modeling capabilities Click here for full-size screenshot
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SmartForecasts’ powerful promotion planning and event modeling capabilities let you automatically forecast future promotion-driven sales for each item in your database. Its specialized event models first isolate and quantify the impact of past promotions on each item. Then SmartForecasts uses those estimates to automatically adjust forecasts to account for your future promotional plans. It readily accommodates to the complexities of using multiple types of promotions and employing unique promotional scenarios for each item you sell. And it does all this while separately accounting for seasonal patterns and trends that are normally beyond your control. This permits you to implement item-specific promotion management policies that provide not only better demand forecasting results but also more cost-effective safety stock and inventory level strategies for all your product items.
The Benefits
With accurate quantitative estimates of the effect of each type of promotion on each product item, you can track the effectiveness of your promotional campaigns using facts instead of wishful thinking. You end up with a much better idea of how much you will sell of each item and when, and you can set your inventory levels accordingly. With this information, you are able to synchronize your supply chain to your promotional campaigns for maximum impact. And if you need to choose between alternative campaigns, you can use SmartForecasts to quickly see the sales scenarios associated with each alternative.
Read how Tura Eyewear used SmartForecasts to accurately model the effects of trade promotions offered to retailers and included those effects in the revamping of its demand forecasting process.
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