Demand planning as a managed service

Situation

A European client of HAVI Global Solutions had a retail product line that was backed by a continuous series of promotions. Accurate forecasts of product demand were key to meeting the demand efficiently during promotional periods. Those forecasts were being generated by decision-makers in the local markets, and we recognized that applying a single set of rigorous forecasting methods could help our client achieve optimum outcomes across the board.

HAVI Global Solutions Strategy

• Created statistical models to predict future consumer demand for the product line, using a standardized approach proven accurate in other product lines and geographic areas
• To evaluate our forecasts against the existing ones, calculated a Mean Absolute Percent Error (MAPE) – a standard measure of forecast error that gives equal weight to under- and over-forecasts

Results

• Our forecasts delivered a MAPE of only 5%, versus the existing MAPE of 30% – a lower level of error for a higher level of efficiency

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