But the fact is, demand – apart from being high, medium, low…– can also be rising, falling, flat… recent, consolidated, etc. In addition, a product’s demand type can vary from month to month!
For a purchasing or product assortment manager, keeping track of 17,000 distinct products (only for alternators and starter motors), on top of all the new incorporations which constantly appear on the market, is an impossible task.
For this reason, it is very important to concentrate our efforts on products which are missing from our product range but exhibit a particular behaviour type in terms of demand.
Out of all the possibilities of demand behaviour, we will analyse two types we find particularly interesting:
1) Products we consider to be of recent demand. They are defined as products which, until 24 months ago, had no demand, from 24 to 12 months ago had a non-existent or very low level of demand, and in the last 12 months have shown an interesting volume of demand.
2) Products with a very important increase in the volume of demand. They are products whose demand level in the last 12 months has been at least 3 times as high as the demand level they showed until 24 months ago.
Now the question to answer is, in the last 12 months, how many products have fulfilled these conditions of demand behaviour?
In Europe, during the last 12 months, a total of 46 products which fulfil the conditions established for recent-demand products have appeared. Some months up to 6 products appear, some months only 1:
In Europe, during the last 12 months, a total of 312 products have more than tripled the demand they showed 24 months ago. Some months over 70 products have behaved this way:
Clearly, if we focus our analytical efforts on products which display certain behaviours in terms of demand, we can drastically reduce the time and resources necessary to maintain, over time, an optimal product range that guarantees the highest level of customer service and allows our stock to rotate at maximum speed.
Can you imagine being able to automatically identify, on a monthly basis, the products which most interest you in terms of the demand type they show, application segments, technologies, suppliers/competitors who have them/or not in their product range, etc.?
These days, the use of data analytics tools is more than essential, helping us to simplify and optimise our daily work.