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AI Demand forecast with historical data to requisition worksheet

Posted on by 35

Hi!

A bit of background info:
We have a supermarket kind of warehouse that has over 1500 products including fruit and vegetables. Every week we see a slight increase in our sales, but the items that are sold can be different based on season but also weather. We order from different vendors at least every week.

Problem:
We want to use requisition worksheets to calculate what we have to order per vendor per location. We have set up our items with a 'Fixed reorder point' so we know when it goes below that point we have to order it. But as our demand is growing this Fixed order point is changing every week. Is it possible to have BC look back to our historical data and figure out that we'll sell more or less in the upcoming weeks? (We have the 'Sales and Inventory Forecast' set up, but it on pretty much all our items says 'variance too high'). But then also have it automatically put in the Demand Forecast so we can take that in account for our Requisition Worksheet?

Side Question:
For fruit and vegetables we see that we sell more on Mondays and Tuesdays then other days for example. We order fruit and veg every day, but we'd like BC to tell us what to put on the PO's. How can we specify that the ordering has to be more/less based on the day of the week. Is it possible to perhaps have a demand forecast per day for fruit and veg, but do weekly for the other items?

  • Guy McKenzie Profile Picture
    Guy McKenzie 1,330 on at
    RE: AI Demand forecast with historical data to requisition worksheet

    Also regarding your daily vs weekly forecast.

    You can do this but your daily and weekly forecasts and planning activities will need to be separated.

    You can’t have daily and weekly buckets in the same forecast.

  • Verified answer
    Guy McKenzie Profile Picture
    Guy McKenzie 1,330 on at
    RE: AI Demand forecast with historical data to requisition worksheet

    I think you really have two options.

    Personally, coming from a stock management background, I would build a jet or Power query report with some fancy calculation model to recalculate my re-order points regularly and import them to BC.

    Alternatively, you need to get a forecasting add-on product such as Netstock that does the analysis for you and writes suggestions to the requisition worksheet based on its own rules.

    The new forecasting features based on AI don’t seem to integrate with the standard planning tools. They seem to be more of a standalone feature that is suitable for small ranges.

  • Verified answer
    Alfredo_Iorio Profile Picture
    Alfredo_Iorio 1,260 on at
    RE: AI Demand forecast with historical data to requisition worksheet

    Hi MaddieGreen

    There is no standard functionality to update demand forecast with past sales in BC.

    The process of updating the Demand Forecast line is manual, unless of developing an extension.

    In my previous implementations for Food & Bev companies I have used two different approaches to this problem:

    1. Copy the demand forecast from Sales Budget with type =  Quantity.

    Sales-Budget.png

    If the organisation have an S&OP plan, they are likely to have sales forecasts.

    If the sales forecasts (Sales Budgets in BC) is updated, the extension can copy the Sales Budget Lines to the Demand Forecast lines with a routine. 

    For companies in the FMCG industry this can be once a day.

    2.  Copy the demand forecast from the Item Register to base forecasts on past sales (Not my preferred option)

    If you work mainly on past sales, the Item Register report holds data about past sales that can be copied to the Demand Forecast lines.

    I don't usually recommend this option because you will not have visibility of lost opportunities due to shortages.

    You Side Question: I would not use Fixed Reordering Qty if your demand changes often. Instead, try Maximum Qty or Lot-for-Lot.

    Then you can setup different Time Buckets for each line depending on stock obsolescence, I.E. products with short shelf-life can have a 1D time bucket while products with longer shelf-life can have 1W.

    Hope it helps.  

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