A lot of brands are stuck between a rock and a hard place at the moment. With supply chains disrupted and costs squeezed, stock building is the obvious answer. But having cash tied up in goods at a time when cash is not easily available is also a risky play.
In recent months, we have had more brands than ever before come to us for advice and support with forecasting, production planning and supply.
We asked our Supply Chain Team to share their quick tips to reduce stress on demand and supply planning.
QUICK TIP 1: It is a team sport
“No matter the size of business, have a form of S&OP process. It is there to bring together demand planning, supply planning, production planning and financial planning which are all very different but interrelated. This avoids butting of heads, keeps alignment and, most importantly, leads to best results.”
Different types of planning should be owned by different teams or individuals – not just supply chain. For example, forecasting, or demand planning is best led by sales but with contribution from supply chain. Equally, getting it right means working upstream and downstream in your supply chain – it is not an internal-only job.
Everyone should be incentivised by forecast accuracy and KPIs should form accordingly to keep all influencers on track.
Is your forecasting and production process giving you a headache? Get confidence from one of our team today.
QUICK TIP 2: Let good spreadsheets do the science, so you can do the art
“How much do I need to order and when? A good supply planning spreadsheet should make it super easy for you to see all this information. It should do all the heavy lifting taking into account lead times, off weeks, bills of materials, and more. A bespoke spreadsheet is the best investment a brand can make because it literally saves hours per day, leading to better results.”
The numbers are just one piece of the puzzle. Time in the team should be spent on the art – building relationships to get better predictions of sales and visiting the factory to help with consistency of production. These all drive improvements in the accuracy of figures.
The math of – what we have, what we’re bringing in, what’s going out, and therefore what we need to produce and when, should be spreadsheet led.
Not happy with your Excel tools to make this work? We can build you something fit for your business, saving you hours.
QUICK TIP 3: Overstocked? Deal with it quickly.
“Overstocking ties up capital, burns through margin and can create a distraction for the team trying to work out what to do next. Brands should have a clear product waste hierarchy and plan so they know exactly what to do and when.”
Clearance is never nice – the margins are never what we like to see. But better gone than gathering dust (and cost) in your warehouse – worst then, to destroy. Every brand needs a grey market route for when they are overstocked with no route out.
Need a route for excess stock? Our Trading Team can advise on your clearance strategy and support your efforts.