Forecast

The forecast describes predicted future sales

The forecast is calculated using the sales velocity and the sales trends in recent months (are sales increasing or decreasing?). Sales velocity is the rate of sales excluding out of stock days. Seasonal products emphasize the sales trends from the prior year rather than the most recent months.

The forecast will cover the days of stock presuming there is stock. For example, if days of stock are set to 60 days, the forecast will predict sales for 60 presuming your stock is fully stocked. 

Note that replenishment will show stock needed to be fully stocked for that amount of time, where as the forecast looks at predicted sales.

Replenishment

The replenishment amount is calculated using sales velocity, lead time, days of stock, current stock level, products on order and the arrival date of ordered products. The lead time is the amount of time that elapses between placing a purchase order and receiving products. Days of stock is a period of time for which you’d like to have enough stock, or, in other words, the stock cover.


Related: Read more about forecasting for the holiday season.

Did this answer your question?