SKUtrak: How can I truly understand demand

The problem is that demand is a complex beast and its many drivers are intertwined and obscured; a truly accurate picture would be beautiful but it just isn't possible, is it?

Poor supply over a few days, into a few locations, reduces sales in a region
Production problems reduce the flow of a key brand and sales are impacted across the country for a few weeks
Promotional returns below plan are blamed on successful competitor activity; are you certain that short supply in week two wasn't a bigger factor?
Your own promotions cannibalise sales from your other products and you waste inventory as a result!

When we don't understand the nature of past demand, we are liable to make poor decisions about the future:

Failing to account for supply issues when analysing past promotional performance risks underestimating demand and guarantees stockouts in future activity
Simplistic forecasts simply don't reflect subtle, or significant, shifts in demand - in an uncertain world this lack of transparency results in a significant risk of under-performance
Poorly informed decision-makers invest huge sums in production, promotion and positioning only to be surprised by weak results

In short, sales do not equal demand. You only ever see what was achieved, not what could have been achieved if you and your retail customers had truly met shopper demand.

What if each of your products had a digital twin which recognised not only the sales you achieved but all of the demand drivers affecting those sales?

The variations over time from seasonality and special events
The effects of poor availability through production and supply chain issues
The impact of promotional cycles, including the cannibalising effect of your - and your competitor's - promotions

With all of these separated-but-related components in play, not only could you replay the performance you achieved but also explore what true demand might look like under different conditions by adjusting the scale and weight of each component. You could replay an infinite number of possible pasts so that you better understand your probable future.

Welcome to SKUtrak TruDemand™.

SKUtrak models the complex interactions between your products' major demand factors using your trading data. It explains changes in sales volume over time in terms of base demand and a collection of component drivers then recombines these components into a high-definition picture of the shopper demand that you met where each component can be highlighted, ignored or adjusted.

SKUtrak TruDemand drivers allow you to explore and understand both the demand for your products that you met successfully through your retail customers and why that demand varied from its baseline, where it wasn't fully met and how to prepare for future demand changes so that you can better match supply.

SKUtrak kind of saved the day with one of our retailers. Probably, if we hadn't of had it, I suspect whilst we would have been up year on year it might have been 6 or 8%. What we were able to identify is where we needed to get the stock to, in order to get the supply chain right. As a result of that, over the 12 weeks of summer, we increased sales with that particular retailer by 22%.

A BEER WINE & SPIRITS (BWS) SKUtrak CUSTOMER