RMG 434 Chapter Notes - Chapter 5: Data Integration, Finished Good, Product Differentiation
Document Summary
Importance of forecasting: supplier -> procurement -> logistics and transportation -> customer service -> finished goods. Inventory -> sales and marketing -> customer: need to know the quantity and characteristics of the products to support marketing to get it at the right place and time. Larger swings in inventory that changes because of customer demand. Important to have an estimation of the lead time than the length. Increase cash to cash cycle by making a contract that suppliers are not paid until product is sold to customers or within 90-120 days after purchasing from suppliers. Ex: tailors make adjustment to clothes during the sale: longer a product can remain in a generic work in progress state, the more flexibility there is to ensure the right product at the right place. Forecasting software solutions: cost = erp is most expensive, generic tools are the cheapest, level of sophistication = most companies erp is most sufficient.