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It’s happened to every manufacturing professional over the years: The computer – or clipboard – shows enough stock to make the scheduled product, but a short delivery or quick uptick in demand means there isn't enough stock on hand to fulfill orders.

Inventory issues, no matter the reason, can be maddening. They can throw even the most carefully planned production schedules into chaos, leaving manufacturers scrambling to meet customer demand and maintain optimal inventory levels.

In Manufacturing, No One Likes Surprises

When surprises or unplanned demand hits, the impact on inventory can be significant. An unpredicted increase in demand may lead to too little inventory to meet customer demand. Likewise, missing demand signals on seasonality or other forces that drive demand downward will result in too much stock that ties up space and cash flow.

Late deliveries or shortages from suppliers without notice can wreak havoc on manufacturing inventory. With the raw materials or components needed to fulfill orders, companies may be able to shift production to other products delaying the most current orders, or they may need to shut down operations completely, resulting in missed deadlines, lost revenue, and angry customers.

The Pitfalls of Trying to Manage Demand Manually

Managing a supply plan that can't maintain inventory to meet demand can take time and effort. It’s common for companies to use manual calculations, spreadsheets, and gut instinct to try to predict demand and adjust production levels accordingly.

However, this approach is error-prone and has many disadvantages. For one, it can lead to excess inventory levels. Over-production can lead to increased storage costs and potential damage or obsolescence of goods. Missed production shipments can lead to lost sales, missed opportunities, and damaged customer relationships. 

No one likes surprises. But the news is never good when those surprises are compounded by the problems associated with manual demand forecasting and supply planning.

How Demand and Supply Planning Software Eliminates Surprises

Fortunately, modern demand and supply planning software can help manufacturers navigate these challenges. It leverages real-time data and advanced statistical methods while embedding itself within processes and providing digital tools to predict demand accurately and adjust production levels accordingly.

One key advantage of demand and supply software is that it can help manufacturers anticipate and respond to unplanned demand. By monitoring trends in real time and analyzing historical data, these tools can quickly detect shifts in demand and adjust production levels to match.

Since supply chain processes are automated, manufacturers can better manage supplier shortages. The software alerts them to potential supply chain disruptions like late shipments and order shortages, allowing planners to adjust production levels and avoid delays or shutdowns. These tools also help manufacturers optimize inventory levels and develop automated and dynamic scorecards to analyze their performance and identify alternative suppliers or materials if merited.

Because contracts, changes, shipments, and other data are in real time, planners have complete supply chain visibility to see demand challenges as they develop and act to mitigate them. Real-time visibility into demand and inventory levels from the vendor production floor to the shop floor drives optimized production schedules, reduced costs, and improved customer satisfaction.

Manufacturers should consider software that integrates seamlessly with existing systems and provides accurate, actionable insights in a strong digital foundation.

Bring Your Inventory Under Control

Surprises from unplanned demand swings or suppliers can significantly impact manufacturing inventory.

Advanced can help you bring surprises under control, look forward accurately, and plan the right balance for your operation. Don't ponder where your inventory went. Know it's there with Plex DemandCaster Demand and Supply Software.

Contact us to learn how we can help you address your surprises and have confidence in your inventory.