22nd April 2020

Supply Chain Management For Spikes In Demand

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The recent COVID-19 crisis has highlighted how peaks in consumer demand can occur with little warning, with hand sanitiser, toilet roll, pasta and flour amongst the products that have disappeared from the shelves of the world’s supermarkets as a result of panic buying. But spikes in demand don’t only occur when a once-in-a-lifetime pandemic sweeps the globe, so manufacturers should be aware of the possibility for unexpected peaks and troughs to occur with little warning, with pressure on the supply chain vulnerable to extremes of weather, celebrity endorsements and shortages of raw materials, among other factors.

Like the species in a food chain, over-demand for a particular product can have a knock-on effect on other products. Panic buying for essentials, or anxiety about the economy, can dissuade people from purchasing ‘luxury’ items, leading to a fall in demand for items that ordinarily would prove popular. Thus, a spike in demand for only a few product lines can have significant effects on the entire supply chain.

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Responding To The Challenge

Without intervention, fluctuations in consumer demand are always challenging to manage. However, a system that provides real-time data and alerts suppliers to increasing demand enables them to respond in an appropriate and timely manner, especially if traders have sufficient ‘back up’ stocks to plug a potential hole in the supply chain while fresh supplies are arranged.

Maintaining delivery routes and ensuring logistics continue to operate uninterrupted is vital to ensuring that goods continue to be supplied in the right quantity to meet customer demand – including products that consumers stop purchasing, to prevent an overstocking situation.

 

How Supply Chain Management Can Respond To Demand

At Reflex Planning, our supply chain management software is designed to ensure that businesses can respond proactively to fluctuations in consumer demand. Normally, supply and demand work in tandem to maintain the supply chain and prevent understock or overstock situations from occurring. However, if consumer demand for a product unexpectedly spikes, the supply-demand relationship becomes imbalanced. Our supply planning software is driven by these exceptions, enabling supply managers to make informed decisions about the allocation of resources and expedition of orders to ensure that goods arrive on-time in the right locations, so that customer demand is met.

Also, Reflex Supply Planning can model different possible scenarios so that the impact on the supply chain can be measured and the impact of potential solutions tested for their efficiency. This is especially important when preparing for potential or developing fluctuations in consumer demand, so that a targeted, timely response can be put into motion to minimise disruption, maintain the supply chain and protect customer service.

 

The Next Step To Protect Your Supply Chain

At Reflex Planning, we’re ready to work with your business to ensure your supply chain can respond to spikes in consumer demand. For a free demonstration of our Supply Planning software, get in touch today to arrange a suitable time.

 

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