Summary
If your forecast and replenishment recommendations don't look right, here's a checklist to make sure your information is correct:
What is the sales velocity? Does it look accurate?
Is the product marked as seasonal?
Are your days of stock set correctly? Note that you will need to set the days of stock for your store.
Is your lead time correct? Note that you will need to set the lead time for your store.
Lead time only applies to replenishment recommendations and does not apply to the forecasted sales.
What is your replenishment date? This indicates the last date to order to avoid stockouts. There will be replenishment recommendations before this date.
Are out of stock days (stockouts) affecting the forecast?
Have the forecasting rules been updated manually? Look at Edit Forecast for a forecast override or percentage override.
What is the time period for the sales history?
Sales velocity
Sales velocity is the rate of sales excluding stockouts (days when the item is out of stock). It informs you about the rate of predicted sales - i.e. how many units are expected to sell per day or month.
Note: If the variant's first sale occurs during the reporting period, then the sales velocity calculation starts with the first sales date by default. Contact the Inventory Planner team if you would like the 'created at' date used instead of the 'first sold at' date.
To see the sales velocity, add the relevant columns to the Replenishment report by clicking the gear icon on the upper right-hand side of the page.
Seasonality
When most of your products have more than 12 months of sales history, you can use seasonality to estimate the forecasted increase in sales.
With a seasonal product, the forecasting algorithm puts more weight on sales 12 months ago and uses that data to account for the increase in sales (if any) of each particular product.
To enable seasonal forecasting, select products in the Replenishment report and click Bulk actions > Enable seasonality.
Days of stock
Days of stock is the period of time for which you’d like to have enough stock - i.e. the desired stock cover. The dates your stock will cover is noted next to the days of stock field.
Dates shown in days of stock begin after the lead time.
Lead time
The lead time is the amount of time between between placing a purchase order with your supplier and receiving products in your store or warehouse. Your supplier may tell you their lead time, or you can determine the average lead time by reviewing past orders in Reports > Good received note.
When in doubt, add a few days.
For more information on how to determine lead time and days of stock, read our article here.
Replenishment date
The replenishment date indicates the last date to order to avoid stockouts or the minimum stock set for the variant. This date is based on your current stock level, sales forecast (sales velocity), and lead time. There will be replenishment recommendations before this date, and you can replenish at any time before or after the date.
Stockouts
Stockouts are days where stock isn't available to be sold.
Note: Your stockout history will start at the date you create your account in Inventory Planner. If you have stock history available prior to your Inventory Planner account creation date, you can import that information from the Replenishment screen by clicking on Import at the bottom of the screen.
View the sales history for the SKU in question. Are there out of stock days (stockouts) that are affecting the forecast? A crucial component of the forecast is the sales velocity, which excludes stockout days to determine the rate of sales if your store was fully in stock.
View the sales history in Replenishment > Details.
Click into the Replenishment and forecast tab then Past Sales to see stockouts.
Forecasting rules
Have your forecasted sales been updated? To see if there was a manual override for predicted sales, look at past sales in the Replenishment and forecast tab (as above).
Any manual changes to forecasted sales will be marked with a blue information icon.
Hovering over the icon will give you details of the original forecast.
To remove manual overrides to the forecast, you can delete any of these entries and Inventory Planner will automatically replace it with the default forecast.
Alternatively, you can clear any manual overrides in the Replenishment report using Bulk actions.
Date range used to compute sales velocity
Finally, review the date range Inventory Planner uses to consider trends in the sales history, including calculating the sales velocity. Any orders from customers during this time period will be used to calculate metrics and the forecast.
If sales were significantly higher or lower two years ago than they have been in recent months, it may make sense to limit this time period to the last six months or year.
You can also set a different date range for individual variants in by clicking the Details icon ("i" icon), then going into the Forecast settings tab.
Enable "Use custom forecasting settings" then click the date beneath the forecasting method to set a different date for the variant forecast.
Answers the questions
Answers the questions
How do I fix the forecast or replenishment?
The forecast or replenishment is wrong. How do I fix it?