A multi-step procedure called demand planning is used to forecast consumer demand and develop a supply strategy that guarantees goods will be available when needed. It incorporates marketing inputs, inventory planning, and sales forecasting to inform decisions about production, distribution, and procurement. The twin objectives of optimizing service levels and reducing excess inventory are balanced by efficient demand planning. With the aid of software tools that examine data trends, seasonality, and market signals, it also plays a significant part in sales and operations planning, or S&OP.
