How can transportation companies use demand forecasting to improve supply chain visibility?

1 What is supply chain visibility and why is it important?

Supply chain visibility is the degree to which transportation companies can see and control the movement of their products and materials from the source to the destination. Supply chain visibility is important for several reasons. First, it can help transportation companies improve their inventory management, by ensuring that they have the right amount of stock at the right place and time, and avoiding overstocking or stockouts. Second, it can help transportation companies reduce costs, by minimizing waste, inefficiencies, and errors in the supply chain. Third, it can help transportation companies enhance customer service, by providing accurate and timely information on order status, delivery time, and product quality. Fourth, it can help transportation companies respond to changing market conditions, by enabling them to adjust their supply and demand plans accordingly.

3 What are the benefits of demand forecasting for transportation companies?

Demand forecasting can bring significant advantages to transportation companies, such as improved customer satisfaction and loyalty, increased profitability and competitiveness, enhanced agility and resilience, and reduced environmental impact. These benefits can be realized by meeting or exceeding customer expectations in terms of product availability, quality, and delivery; optimizing inventory costs; reducing operational expenses; increasing sales and market share; minimizing carbon footprint, energy consumption, and waste generation; and being able to adapt to changing customer preferences, demand patterns, and market conditions.

5 What are the best practices for demand forecasting for transportation companies?

Demand forecasting is a complex and dynamic process that requires transportation companies to follow some best practices. This includes defining the purpose and scope of the demand forecast, such as the time horizon, level of detail, frequency of update, and target audience. Additionally, it's important to choose the appropriate demand forecasting method based on data availability, demand characteristics, and forecast objectives. Furthermore, you should validate and evaluate the demand forecast by comparing it with actual results and calculating forecast errors and accuracy measures. It's also essential to communicate and share the demand forecast by using clear formats, terminology, and assumptions as well as soliciting feedback from relevant stakeholders. Finally, you should learn from the forecast by identifying sources of errors, areas of improvement, and best practices to apply to future forecasts.

6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?