Business Terms Dictionary

Supply Planning

Supply planning is the process of determining how to meet the demand for products in the most efficient and cost-effective way. It involves coordinating inventory levels, production schedules, purchasing, and logistics to ensure that the right products are available at the right time and place.

What are the components of supply planning?


Key components of supply planning include:

  • Demand forecasting: Predicting customer demand using historical data and market trends.
  • Inventory planning: Deciding how much stock to keep, where to store it, and when to replenish.
  • Production planning: Scheduling manufacturing activities based on capacity and demand.
  • Procurement planning: Managing the purchasing of raw materials or finished goods.
  • Distribution planning: Ensuring products are delivered to customers or retail locations efficiently.

The goal is to balance supply and demand while minimizing costs, stockouts, and excess inventory.


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Traditional supply planning often leads to overstocking or shortages due to inaccurate forecasts. With ForgeFlow Cloud ERP’s DDMRP system, supply planning is based on buffer status and demand-driven replenishment, ensuring materials are available when needed—without excess inventory. 
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