What is it ?

Promotions are nowadays common. We observe higher sales volume and higher product varieties.

They pose challenges to inventory management. Inaccurate planning can lead to excess inventory at the end of the promotion or dissatisfied customers due to product unavailability.

Novelty products also cause concerns because of their less salvage value. Promotional planning, therefore, becomes necessary to maximize profit and customer satisfaction

Promotions can be of broadly two types:

• Stock-clearance (Inventory reduction) or singlepurchase.

• Regular sales promotion.

While in the first case, replenishment planning is not that important (except where a stock reconciliation is needed), in the latter case retailers must plan for adequate stock to meet customer demand.

Some Practical Aspects

Expertise Vekia Promotional Replenishment Planning

• Response time at the upstream stages for the changes in downstream demand.

• Purchasing from multiple sources :

– Bulk purchase with discounts
– Multi-supplier products
– Outside staging
– Alternate sources inside the supply chain

• Multiple deliveries

Methodology


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