Demand Forecasting in Inventory Management

Demand forecasting in inventory management is the process of predicting future customer demand for products. This helps businesses determine how much stock they need to keep on hand to meet customer needs without overstocking or running out. Accurate forecasting considers factors like historical sales data, market trends, seasonal changes, and customer preferences. By understanding demand patterns, companies can optimize their inventory levels, reduce carrying costs, and improve customer satisfaction by ensuring products are available when needed. Essentially, it's about balancing supply with expected demand to operate efficiently.