Sales and operations planning is critical to supply chain management success. Not only does it promote planning across departments in your company, it can contribute to your company’s success. Here’s why S&OP is important.

Your company can optimize the cost of production.
When it comes to managing a company’s spending and revenue, precision is key. If your company orders too many or not enough parts, it can affect your company’s bottom line. This type of planning improves financial efficiency and keeps you within your budget.

Planning allows your company to forecast profits and losses.
It’s not feasible for companies to be short-sighted when it comes to finances. Long-term planning offers the best way for companies to get a glimpse of what their financial futures hold. It can help your company’s executives and managers make decisions that move the company in the right direction. In fact, some companies have improved their forecasts by as much as 25 percent.

Sales and operations planning improves shipment and delivery rates.
Late and missed shipments can adversely affect your customers’ profit margins. If it happens too many times, some customers will find another supplier. With S&OP, you can improve your delivery processes from 10 to 50 percent.

Planning can provide solutions to many of your company’s challenges.
Improving your business processes with S&OP can have positive effects on your company. If your employees are having problems managing your company’s supply chain, S&OP can help. Having a written plan can hold your employees accountable for their roles in supply chain management. With effective S&OP, your company can realize quantifiable results.

Interested in learning about how sales and operations planning can impact your business? Contact River Logic to speak with a representative about your goals. Our solutions include capacity planning, trade promotion optimization, scheduling/production planning and sourcing/procurement.

Click here to know more about Sales and Operations Planning