Calculate Item Demand Plans
In this section, we will be covering how to create the Item Demand Plan for each product.
Step 1) Go to Transactions > Demand Planning > Item Demand Plans > New
Step 2) On the Calculate Item Demand Plans page, we need to enter some required fields. In this example, set these fields as follows:
Projection Method: Seasonal Average
Projection Interval: Monthly
Projection Duration: 6
Historical Analysis Duration: 36
Once those options are set, tick the checkbox for the product you want to create the demand plan for. (Fig. 1)
Step 3) Once you have clicked Submit, you will be brought to the 'Item Demand Plans' overview page. This will list all new and previously created item demand plans. Find the demand plan you just created and click View. This page shows you the projected future demand for a 6 month period, based on 36 months of historical data. (Fig.2)
Explanation of Fields
- Projection Methods
- Linear Regression: The linear regression method uses previous demand to project future inventory based on the ordinary-least-square regression method.
- Moving Average: The moving average of historical demand data is used to calculate the average overall stock level needed.
- Seasonal Average: This option uses previous demand to examine seasonal trends of inventory flow and then projects a similar seasonal flow. NOTE: Using this method, the projection interval must be set to Monthly intervals.
- Sales Forecast: This option will use forward looking sales forecast data to project inventory demand.
For further explanations on the above fields, please see this link: [1]
