Supply Chain Management Demand Planning 5

Question 1

In demand planning, 'demand sensing' differs from traditional forecasting primarily because it:

Accepted Answer

Leverages near-real-time signals like POS data to update short-term forecasts daily

Answer

Demand sensing uses high-frequency downstream data (POS, shipment, consumption) to continuously refresh the near-term forecast, reducing latency versus monthly statistical runs.

Question 2

A company sells ice cream and experiences much higher demand during summer months. This pattern would be classified in decomposition as the:

Accepted Answer

Seasonal component

Answer

The seasonal component captures regular, calendar-driven fluctuations that repeat within a year, such as summer spikes for temperature-sensitive products.

Question 3

Which of the following best describes 'market intelligence' in demand planning?

Accepted Answer

Qualitative inputs from sales teams and market data that adjust the statistical forecast

Answer

Market intelligence encompasses qualitative information — sales team insights, customer feedback, competitive activity — used to override or enrich statistical forecasts.

Question 4

A retailer provides its supplier with direct access to store-level inventory and sales data to improve replenishment. This arrangement is called:

Accepted Answer

Vendor-Managed Inventory (VMI)

Answer

In VMI, the supplier uses the retailer's inventory and sales data to autonomously manage replenishment decisions, improving service while reducing the retailer's planning burden.

Question 5

When a company disaggregates a national-level demand forecast down to individual SKUs and distribution centers, this process is called:

Accepted Answer

Top-down forecasting

Answer

Top-down forecasting starts with an aggregate forecast and distributes it to lower levels using historical proportion ratios or planned splits.

Supply Chain Management Practice Test

Supply Chain Management Practice Test

Supply Chain Management Demand Planning 5