Transform Data Into Demand Insight5 min read
The ever-increasing pace of changing consumer behavior means retail and consumer packaged goods (CPG) companies must do more than regularly refine their digital strategies to remain competitive. Now it’s become critically important to ensure that every product SKU is optimized. When the right amount of product is in the right place at the right time, it directly impacts a company’s performance and bottom line.
Utilizing technology such as artificial intelligence (AI) and machine learning (ML), retail and CPG companies can leverage data from customers’ touchpoints. Records of past transactions, events, and promotions become a gold mine of information. By automating demand forecasting, organizations can extract additional business value and produce forward-looking insights. Here’s how SoftServe transforms your data into demand insight and supercharges your sales with our custom-tailored demand forecasting solution.
The Insight Imperative
Every organization is constantly looking for a way to gain a competitive advantage. Whether it’s a CPG company needing to improve their supply chain, a retail company seeking a better understanding of their customer’s wants, or CPG and retail organizations wanting faster restocking across warehouses and distribution centers.
The current impact of a global pandemic on both in-store and e-commerce, supply chain operations, and primary goods production means predicting which items will be most in demand is critical. Yet many organizations still utilize grueling, manual processes, with many business leaders still believing that forecasting is too time-consuming. Retail and CPG businesses need automated forecasts that can help predict seasonality, spikes, trends, and anomalies for the myriad scenarios they currently face.
To achieve these objectives, many retail and CPG companies are turning to artificial intelligence (AI) and machine learning (ML) tools. This includes hiring teams of data scientists to help build out models and interpret the data. Ultimately, these organizations want to reduce their overall risk, better understand what their short-term and long-term business goals should be, and plan for scalable success.
Deluge of Data
Organizations have no lack of data, with daily data points ranging from sales and production to distribution and marketing. However, what is lacking for many companies is a solid understanding of how to automatically turn data into actionable forecasts. Of the companies that try to do so manually, many use spreadsheets that are difficult to support or complex financial tools that lack scalability, all to only mixed results.
Many companies fail to combine price, discount, and SKU data with other important variables such as store location, holidays, product features, promotions, discounts, store size, or specific customer segments.
Additional challenges include businesses lacking experience in designing forecast models or processes or not knowing the number of time series to be supported. All of which leads to results that either take too long to prepare or aren’t useful. Further, retail and CPG companies look at similar data and processes from different viewpoints, making forecast alignment much harder. The demand forecasts resulting from these efforts are frequently disappointing and fail to provide bottom-line business benefits.
Leveraging Expertise and Experience
With SoftServe’s custom-tailored demand forecasting solution, retailers and CPG firms can overcome these challenges, test hypotheses, and quickly create automated forecasts—all without needing deep technical knowledge. Since this customized solution is entirely cloud-agnostic, organizations from different business domains can access their forecasts or fine-tune models on any cloud provider or on-premises.
This custom-built, automated approach to forecasting means companies can easily upload past data and allow the demand forecasting solution to do the rest. One of the hidden keys to success is a company's historical data series, known as time-series data.
It’s made up of captured data from past sales by item, date, and location over a set time period. Combining this time-series data with additional business-specific variables results in automated forecasts. Decision-makers then validate the forecast assumptions and implement business improvements.
A powerful stand-alone tool, you can further enhance SoftServe's custom-tailored demand forecasting solution by collaborating with our data science experts. There are many configuration options and usage tips that can accelerate data intake, improve the outcome of forecasts, and deliver results more in tune with your organization’s goals. In many cases, leveraging SoftServe’s expertise can dramatically improve results compared to taking a do-it-yourself approach.
Driving Successful Demand Forecasting
SoftServe has successfully delivered projects across retail and CPG enterprise business units using customized versions of this demand forecasting solution. Our experts helped one client fine-tune their product mix by geography, demographic, and season using product demand forecasting. This significantly improved their inventory management and customer analytics.
For another client, SoftServe customized the platform for “what-if” scenario analysis. Our client was then able to forecast the impact of a variety of changes on their business, supply chain, and financial models.
A third client saw increased operational efficiency with SoftServe tailoring this tool for resource planning. The predictions ensured our client had the needed materials, transportation, human resources, e-tail capacity, and distribution centers available to meet demand.
These examples are why many retailers and CPG organizations—including a top-three global supermarket chain and a top-three global toymaker—have all turned to the experts at SoftServe for help with their forecasting models.
Our experts work to uncover the data insights clients need most, perform a deep dive beyond simple forecasts, and then leverage our end-to-end retail and CPG experience in data science and analytics to deliver success.
LET’S TALK if you're ready to discover how SoftServe’s custom-tailored demand forecasting solution transforms your data into demand insight, delivers more accurate demand predictions, and optimizes operations.