Foundation: Integrated Demand Forecasting

DemandOptimizer maximizes profitability in online and retail B2C, D2C, and B2B markets by coordinating actions across departments based on a common understanding of demand. It operates in rapidly changing markets where reaction time is crucial.

• The system generates a nightly forecast of customer demand for each product, aiding supply, pricing, sales, and marketing decisions. It offers a shared forecast, addressing pricing opportunities, sales, marketing, and replenishment needs. Each department can access the forecast independently, reducing cross-departmental communication.

• Extended time-series forecasting is used due to demand occurring continuously instead of specific events, resulting in high prediction error rate for individual transactions at specific points in time.

• DemandOptimizer integrates forecasts to prevent conflicting attempts to maximize returns. Independent sales and supply forecasts cause disconnection and missed opportunities. For example, sales may plan a promotion due to soft demand, but supply is unaware and fails to meet increased demand. DemandOptimizer's integrated forecast prevents these departmental activities from being lost.

• Forecasts are generated for each channel segment (e.g., retail, online, marketplace) at the SKU level. Segmentation helps manage channel inventory and sales, while aggregating channels facilitates demand shift management (e.g., retail to online). Various supply centers are considered in the forecasting, referring to distribution or logistics locations responsible for meeting geographic demand.