{"id":7176,"date":"2020-06-17T16:03:39","date_gmt":"2020-06-17T20:03:39","guid":{"rendered":"https:\/\/www.sage.com\/en-us\/blog\/?p=7176"},"modified":"2026-02-12T05:05:24","modified_gmt":"2026-02-12T10:05:24","slug":"inventory-planners-post-covid19","status":"publish","type":"post","link":"https:\/\/www.sage.com\/en-us\/blog\/inventory-planners-post-covid19\/","title":{"rendered":"The perplexities for inventory planners post COVID-19"},"content":{"rendered":"
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\n\t\t\t\t\t\t\tMoney Matters<\/a>\t\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t
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\n\t\t\t\t\t\tThe perplexities for inventory planners post COVID-19\t\t\t\t\t<\/h1>\n\t\t\t\t<\/div>\n\n\t\t\t\t\t\t\t\t\t

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\n\t\t\t\n\t\t\t\t\"Craig\t\t\t\tCraig de Kock<\/span>\n\t\t\t<\/a>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t<\/div>\n<\/div>\n\n\n\n

As Charles Darwin once said, it’s not the most intelligent nor the strongest who survive but rather those who are better able to adapt to the changing environment in which they find themselves.<\/p>\n\n\n\n

Nothing could be closer to the truth, especially in these turbulent COVID-19 times. Companies that can pivot their business, change their operational models, or adapt their product offerings to suit current trends are the ones that will survive. Essentially doing whatever it takes to reposition your business to succeed.<\/p>\n\n\n\n

This article provides practical steps for inventory planners. Steps that will help avoid a ripple effect on your inventory that could affect your business<\/a> for years to come.<\/p>\n\n\n\n

For companies, the supply chain is impacted by two major areas:<\/h3>\n\n\n\n

1. Supply<\/strong><\/p>\n\n\n\n

We have situations where some suppliers are closed down and not likely to open until lockdowns are lifted. Some suppliers can still manufacture but on reduced capacity. This has raised serious questions regarding whether it is prudent to continue sourcing from other parts of the world where we have little or no control over the supply. Companies are re-evaluating the offshore manufacturing options and looking to move that back to local countries as a result. All of this will have a massive impact on supplier reliability and planning parameters like lead times, batch sizes, and minimum buy constraints.<\/p>\n\n\n\n

2. Demand<\/strong><\/p>\n\n\n\n

The demand for product lines has changed. There is a demand for products that before COVID-19 were lower on everyone’s shopping list, and due to country lockdown laws, there is zero demand on non-essential products. Inventory planners are wanting to know if this is only in the short term and how long is that short term? Will demand ever return to “normal levels”? What will “normal” look like, months, or even years from now?<\/p>\n\n\n\n

On the other hand, due to the dramatic impact this is likely to have on the economy, the demand for a bigger basket of products may be either dramatically reduced or totally non-existent for the foreseeable future. Relating this to the supply chain, we are faced with a situation where both demand and supply is uncertain.<\/p>\n\n\n\n

Planning in a situation like this is entirely dependent on the information we have available and the accuracy of that information. Accuracy in this context is likely to relate to how current the data we use is. As an inventory planner, you need to understand what happens to your planning parameters going forward.<\/p>\n\n\n\n

The situation that most companies are currently facing is that their sales are lower than usual, and their orders aren’t coming through from suppliers as expected. Even a sophisticated forecasting system with learning ability has very little chance of reacting correctly to this unprecedented change in the demand and supply streams. This has a direct impact on all future forecasts, and you need to make manual changes and strip out these anomalies, or your ordering will be way off.<\/p>\n\n\n\n

A few things to consider:<\/strong><\/p>\n\n\n\n