CIM Demand Forecasting & Supply Planning

Question 1

What is the main purpose of demand forecasting in inventory management?

Accepted Answer

To predict future product demand and optimize stock levels

Answer

To increase warehouse space.

Answer

To minimize labor costs.

Answer

To eliminate the need for suppliers.

Question 2

Which technique uses historical data to estimate future demand?

Accepted Answer

Time series analysis

Answer

ABC analysis

Answer

Safety stock calculation

Answer

Cycle counting

Question 3

What does a high forecast error indicate?

Accepted Answer

Inaccurate demand predictions

Answer

Excellent data accuracy.

Answer

Low lead time.

Answer

Optimized inventory costs.

Question 4

Which metric is used to measure forecast accuracy?

Accepted Answer

MAPE

Answer

ROI

Answer

Lead time

Answer

SKU count

Question 5

Why is collaboration important in supply planning?

Accepted Answer

It supports synchronized decision-making across departments

Answer

It increases lead times.

Answer

It reduces visibility.

Answer

It delays procurement.

Question 6

What role does lead time play in supply planning?

Accepted Answer

It helps determine order timing and quantity

Answer

It eliminates the need for inventory.

Answer

It reduces shipping costs.

Answer

It affects employee satisfaction.

Question 7

What is safety stock used for?

Accepted Answer

To handle unexpected spikes in demand or delays

Answer

To reduce sales.

Answer

To increase delivery time.

Answer

To eliminate inventory.

Question 8

Which tool helps visualize and track demand and supply planning?

Accepted Answer

ERP systems

Answer

Barcode scanner

Answer

WMS only

Answer

POS terminals

Question 9

What is the impact of underestimating demand?

Accepted Answer

Stockouts and lost sales

Answer

Excess inventory.

Answer

Increased profitability.

Answer

Faster deliveries.