Demand improving visibility

INFORMATION An online seller can share demand information throughout its supply chain to improve visibility. The Internet may also be used to share planning and forecasting information within the supply chain, further improving coordination. This helps reduce overall supply chain costs and better match supply and demand. Here we see that information is an enabler of many of the benefits of online sales discussed so far. 

Nevertheless, some of the improvement processes will initially lead to investments for the companies. The investments do not have to be large, but they will demand time from some of the employees. The management needs to be aware of the fact that the earnings will not necessarily become visible immediately after investing the money. Improvement processes can only be successful if the management has a long-term planning. 

VMI is piloted only in a few customers or suppliers, but it is not considered as a key strategy for improving demand visibility and reducing inventory carrying costs. 

For products with fluctuating demand, postponement is an effechve long term strategy. Tactical strategies include improving forecast accuracy, increasing raw material and product visibility and document automation. 

The development conditions of modern supply chains fundamentally change the vision of their future. Globalisation, the development of digital markets, the growing and more visible individualisation of demand, create - even force - a different model of collaboration within the supply chain. Attempts to improve competitive advantage and to limit the internal potential in this area more often than not encourage companies to review the nature of contacts with entities along the specific product s economic path. 

GSl Switzerland, the leading association dedicated to the design and implementation of global standards and solutions to improve efficiency and visibility of supply chains and demand management. GSl Switzerland was the project s disseminating partner. 

How in reality do we move the fulcrum closer to demand The answer in effect is to improve the visibility of demand along with enhancing the velocity of the supply chain. In other words if we can have a clearer view of real demand in the final marketplace, rather than the distorted picture that more typically is the case, and if we can respond more rapidly, then a more effective matching of supply and demand can be achieved. 

One of the advantages of having direct contact with the customer through online ordering is the dramatic improvement in visibility of real demand that it provides. For example, Tesco, one of the world s biggest online retailers (as well as one of the world s biggest bricks and mortar retailers), can see what its real product availability is because it is able to capture actual demand as it happens and is therefore able to measure on-the-shelf availability accurately. In the bricks and mortar business, even with sophisticated electronic point of sale (EPOS) data, the company cannot get the same level of accurate information. 

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