The project focused on solving the situation that US Sales leaders in Nuqleous may struggle with fluctuating demand and ineffective perishable goods allocation due to unknown future sales under different purchase channels.
Business Challenge Retail suppliers struggle to balance inventory levels for perishable goods, needing precise sales forecasts to avoid overstocking or stock-outs.
Data Analysis Approach ● Data Source: 714-day sales data from major retail stores, provided by Nuqleous. ● Forecasting Methods: ○ Direct Forecasting of total weekly sales. ○ Channel-Specific Aggregation across different sales channels.
Bad inventory planning can have a negative impact leading to loss of sales at the retailer end (understocking) or an inventory build-up across the chain (overstocking). This can result in potential losses to all stakeholders in the chain. Forecasting can help demand planners of retail chains make better decisions regarding the right quantity of products to stock on retail shelves.
In the retail business, it is crucial for the firms to accurately forecast sales in the future to prepare themselves and optimize costs. Over-estimating sales can lead to a significant cost of inventory holding and even losses due to expiry in case of perishable items. There could also be a scenario of underutilized resources in manufacturing be it machinery or labour. Underestimation of sales in forecasts can lead to loss of business opportunity.