Mapping the future of CPG demand planning

No matter how unpredictable the world becomes, humans will try to divine the future and plan accordingly. 

But in the consumer-packaged goods world, intuition and educated guesses are not enough.  

Executive leaders, functional teams, and individual professionals must all understand their company’s potential and their role in achieving it.

And since the future isn’t set in stone, they need to envision and plan for multiple scenarios. 

This article explores the technology choices CPG teams face to collaborate on improving demand planning, allowing them to not just forecast the future but actively shape it in a sustainable way.

The changing context in CPG demand planning

In a complex and volatile world, companies and teams need to understand how global events and their actions affect demand to tailor their plans accordingly.

Innovative technologies, especially artificial intelligence, promise more reliable and accurate forecasts, offering better insights into how external events and internal initiatives impact key metrics like profitability.

Achieving holistic insight into current operations and future performance is crucial for developing a sustainable revenue generation strategy.

However, AI requires timely and accurate data. Each department must ensure the data they generate is accessible to AI demand planning tools.

Moreover, the insights generated must be relevant and accessible to the entire organization, from promotion specialists developing new strategies to C-suite executives evolving corporate targets for sustainable profitability.

Key factors to look for in CPG demand planning tools

CPG planning is a continuous, collaborative, and holistic effort. Once this is understood, it becomes clear that robust demand forecasting depends on the entire organization and the technology it employs. Choosing the right platform means considering a range of factors. 

1. Using AI to produce accurate baselines and forecasts 

Artificial intelligence has the potential to transform CPG demand planning and forecasting, just as it has in many other industries.

Cutting-edge AI models can improve baselines, giving CPG professionals insights into past performance. This provides a reliable starting point for future predictions and evolving multiple scenarios that account for unexpected events and the impact of their initiatives.

Both the C-suite and frontline workers should be able to drill down as needed, from assessing actions at a macro level to the impact on individual product lines or retailers.

However, the potential of AI must be viewed within a broader context. 

2. Smoothing data connectivity 

As we’ve seen, AI-powered forecasting is simply not possible without quality data.  

In legacy systems data can get trapped in departmental tools or spreadsheets, where it becomes stale and unshared. Feeding algorithms will usually mean breaking down the silos that separate different teams and functions, such as promotions and pricing 

To deliver the broadest and most nuanced view of the CPG world, AI forecasting tools need to incorporate external information like syndicated data, market analysis, weather data, and more.

This requires the latest AI to be integrated with a data connectivity platform that smoothly incorporates and keeps the latest data flowing.

Without this data flow, you may get a snapshot of the future, but not the evolving, multi-dimensional picture you need for resilient CPG demand planning. 

3. Enabling cohesive teamwork and collaboration 

This data flow is not one-way. AI-generated forecasts and insights must be shared across the organization, ensuring every department and team works with the same information.

This allows them to see how their actions and innovations affect forecasts. The organization must tailor workflows to link different departments, ensuring compliance and approvals speed up decision-making rather than hinder it.

4. Tying it all together to benefit the organization

CPG demand planning, along with cutting-edge forecasting technology, requires a platform that breaks down barriers between functional teams, enabling the free flow of data and ideas. This ensures better synchronization and coordination between teams, optimizing plans for the company’s overall benefit.

This could be as simple as coordinating marketing and trade promotions for maximum impact in a given quarter. Over time, it means teams work to ensure all activities contribute to a long-term, sustainable revenue generation strategy, delivering value for all stakeholders.

How Visualfabriq helps in CPG demand planning

Visualfabriq delivers tailored modules for key CPG functions such as trade promotions, trade spend, demand forecasting, and revenue management. 

These modules are supported by a unique data integration layer that simplifies data management and sharing between modules and other corporate systems like ERP. It also smooths the integration of external data from third parties, EPOS systems, and retail partners. This eliminates the need for manual updating, reduces the possibility of mistakes and frees CPG professionals from repetitive, uninspiring tasks. 

The embedded AI in Visualfabriq ensures CPGs can maximize data value, providing accurate baselines and insights into past performance. This serves as a foundation for far more precise forecasts of future demand. It also includes the ability to model multiple scenarios to account for unexpected events and controllable factors like new launches or promotions.

The highly integrated nature of Visualfabriq’s demand forecasting software ensures that individual teams can share plans and optimize accordingly. And they can tailor workflows to suit their organization’s needs. 

Delivered as a service, Visualfabriq ensures teams always have access to the latest features and algorithms, with predictable costs.

This enables all staff to work with a unified view of past and present data, collaborating to shape the best possible future for the company, its retail partners, and customers.

Takeaways 

In an increasingly unpredictable world, it’s crucial for CPG companies to focus on demand planning as they look to ensure their own sustainable growth and deliver value to retail partners and customers. 

AI can provide more accurate baselines and forecasts if it has access to the right data, including external information. Therefore, AI should be integrated into a comprehensive CPG demand planning solution that unites key functions within the organization, enabling them to work together to deliver value for all stakeholders.

To understand how Visualfabriq’s software can help you shape your organization’s future get in touch and arrange a demo today.