Supply chain planning also called as SCP is the process by which we anticipate the demand for a product and plan their materials and components, marketing, distribution and its sale. The main goal of the Supply chain planning is to balance the supply and demand, so the sales revenue opportunities are fully utilised at the lowest possible cost.
What is supply chain planning?
Supply chain planning is one of the most important categories of supply chain management and supply chain execution. The onset of Supply chain planning begins with demand planning. This involves the planning and foreseeing of sales based on historical data and other sources of information. This information is used to find patterns to predict future demand for products thereby.
What is a Supply chain planning system?
While we look into the main factors, here are the main Supply chain planning systems benefits:
- It determines how to fulfill the requirements to be created from the demand plan to the best of its potential. The financial and service objectives of the company must be achieved by the objective to balance the supply and demand of the products.
- SCP will address production planning and manufacturing modules within the enterprise. This will help in the allocation of employees and materials within the company.
- Effective demand planning and will make sure that the products are properly delivered and can improve revenue forecasts of the company by aligning the inventory numbers and the demand as of the present moment to increase profitability.
- Real-time Supply chain planning will ensure very little wiggle room for errors and is automatically ready for disruptions if and when need be.
- The Supply chain planning can be unified with enterprise planning and benefit in their business processes to make real-time updates regarding inventory and supply of products. It also helps in creating a collaborated sector to optimize profitability by making use of the resources for the key stakeholders.
- Incorporating a real-time Supply chain planning allows more accurate stock management and prevents too much accumulation of inventory.
- SCP allows the flexibility to cope with changes based on market trends.
The Supply chain planning is a tactical approach that if implemented, will optimize the delivery of products and its manufacture. It also enhances the ability to foresee market demands and act according to the needs without wasting out on inventory. It can drastically lower production costs and increase sales and help manage relationships with the suppliers of the product.