Panic buying, border closures, container shortages, rapid shifts in consumer demand, volatile investment markets… In the world of retail, Covid-19 has a classic disaster movie plotline. Organisations around the world have had to strap themselves in for a rollercoaster ride of uncertainty, and we’re far from the finish. Smart supply chain decisions matter now more than ever before. Here are a few ideas!
Think Outside The Box When It Comes To Data Sets
Alternative data sets can bring new insight in a fog of uncertainty. Sometimes known as ‘dark matter data,’ it’s likely that your organisation is already using alternative data for some of its decision making. Examples include employee knowledge about local habits, or analogous events such as previous economic meltdowns, or natural disasters that have caused lengthy disruptions. Examining past models of economic recovery patterns can predict future consumer behaviour.
When incorporating dark matter data, it is particularly important to have real-time sales tracking in place as a support mechanism. Real-time tracking gives precise signals regarding consumer momentum, helping businesses plan for demand and capitalise on emerging opportunities.
Think Local
Think you know your local market? We’ve had lots of reports of clients being surprised to discover that the seasonal events that they thought were important were actually less relevant in 2020 than unmeasured occasions such as farmer’s markets, fairs, and sports events. When companies fed this local information into their forecasting software, it radically changed their understanding of demand, improving overall forecasting accuracy. With greater accuracy comes reduced waste, improved logistical management, and fewer returned items.
With the right setup, organisations can turn local knowledge into powerful market predictions on which to base their sales strategies. Look for software that offers a blend of control and flexibility, such as Reflex Planning, so that the full spectrum of information can be harnessed.
Think Complex Modelling
When a hurricane is brewing, forecasters do not rely upon one information source because unpredictability may render a single model unreliable and vulnerable. Instead, they blend multiple predictive and real-time models to suggest a likely scenario. The broader the variety and range of inputs, the more accurate the result.
During times of economic uncertainty, the same is true in demand forecasting. For example, adopting a single model that uses a moving average of sales paradigms lacks robustness if market forces suddenly shift or circumstances change. However, when supported by models of previous sales during times of instability and comparative data from other points of sale, the predictive confidence level rises.
Consider feeding data from multiple simple, transparent models into your planning software. For instance, explore how demand has shifted in other countries during different phases of their Covid-19 recovery, and factor this into your forecasting, alongside the risk posed by new virus variants and the re-imposition of lockdown restrictions. The mix of viewpoints should offer a more accurate idea of the storm’s trajectory.
Next Steps
It’s possible to be sales savvy during a pandemic, but it often requires thinking outside the box. This is best achieved with the support of comprehensive forecasting and planning software that can turn your ideas and instincts into reality. For more information about our demand forecasting solutions, please get in touch today.
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