For manufacturers launching new products, the ability to more accurately answer "What will happen if ...?" is a significant competitive advantage. SAS, the leader in business analytics, delivers that advantage with enhanced SAS Demand-Driven Forecasting software that helps manufacturers create more accurate sales and operations plans bolstered by efficient distribution networks.
"Our forecast accuracy improved immediately when we switched to SAS," said Arnaud Joliff, Nestlé director of supply chain integration. "There is no second guessing now. Forecasting accuracy reduces safety stock, inventory days on hand, storage costs and freight costs. Gaining a few points of accuracy at the national level generates supply chain savings immediately. We can know what kind of lift is generated by a particular deal with a retailer and immediately adjust the supply chain."
Traditional enterprise resource planning (ERP) and supply chain management (SCM) systems can't deliver the forecast accuracy needed by manufacturers. Lacklustre forecasting leaves scars: lost sales, over-allocated budgets, obsolete products and overstocks. SAS Demand-Driven Forecasting automatically tracks variations between forecast and actual numbers to guide sales and operations planning. SAS combines historical shipments, customer and other upstream data, and causal data like holidays and marketing promotions to derive a demand plan to maximise profits, market share and customer satisfaction. A new product forecasting workbench gives customers unparalleled ability to integrate new product forecasts into the planning process.
Because new products have no sales history, the forecasting workbench uses "like items" – historical data of groups of existing products with similar attributes - to create an objective forecast. Powerful SAS analytics automates the selection of like items, facilitates the review and clustering of past product introductions, and creates meaningful statistical forecasts. The results help allocate supply chain resources, establish inventory levels and schedule sales promotions before a launch.
"There is so much uncertainty around new products," said Mike Newkirk, SAS Director, global manufacturing and supply chain product marketing. "SAS Demand-Driven Forecasting helps customers drive down the risk of a new product introduction. SAS Demand-Driven Forecasting addresses this needed capability by using a patent-pending methodology called 'structured judgment'."