Now, That’s a Well-Oiled Machine

Run Your Inventory Management Capability Effectively with a Well-Oiled Predictive Demand Engine

There’s a reason why people say, “It’s a well-oiled machine” reacting to a process or journey is going smoothly.  When something works as it should, with everything and everyone in sync, then it resembles a well-run assembly line or a smooth-riding train. Everything is working together towards a common goal.  

The same concept could apply to retail inventory. When everything and everyone is in sync, retailers can achieve the ultimate goal that drives profits– getting the right inventory, in the right amounts to the right locations, and at the right price. However, there’s always something that can cause a hitch in the process. In retail, one thing you can count on is that the needs and wants of customers will change constantly. Demand changes constantly. 

A well-run assembly line is centered around one component that guides the other parts. The 4R One Predictive Engine uses a single source for demand forecasts to drive supply chain and merchandising decisions to guide other inventory planning processes, like replenishment planning and allocation planning.  This takes the weight off staff to predict (or go by their gut feeling) what is needed at every store location, warehouse or distribution center.  By leveraging this single data model, the Predictive Engine provides a holistic view of the entire supply chain, down to the SKU/store level, allowing for more accurate and efficient decision-making.  As a result, retailers and businesses can optimize their assortment by identifying the right mix of products to offer, at every location, based on customer demand and market trends.  

One Predictive Engine Guides Other Planning Components. 


Decisions about replenishment can be greatly enhanced by a One Predictive Engine. By continuously monitoring inventory levels, customer demand and lead times, it can help to accurately predict when and how much inventory will need to be replenished. This will help businesses avoid stockouts and overstock and in turn, lead to improved customer satisfaction and reduced cost.   

Seasonal Products  

Seasonal inventory is very important and probably the most difficult to plan. There is always a large demand for seasonal products and yet there is a short period to turn that inventory into profits.  One Predictive Engine can analyze historical sales patterns, market trends and customer preferences to forecast demand for seasonal products. This allows businesses to optimize their inventory levels and ensure they have the right products available at the right time, which maximizes sales opportunities and minimizes waste. 


Many retailers purchase inventory based on historical data alone.  That doesn’t work and can lead to excess inventory. Retailers need a markdown strategy that moves the excess inventory quickly, but also at the greatest possible profit. One Predictive Engine can help analyze a range of factors, such as historical sales data, pricing strategies, and customer behaviors to determine the optimal markdown strategy for each product. This ensures that businesses can maximize their profitability while minimizing the risk of excess inventory.  

Predictability is the key to managing a supply chain efficiently. Imagine being able to accurately predict exactly how customers are going to buy, what they will buy and where they will buy it. That would solve everything, right?  Not necessarily. Customer behavior and preferences are just a couple of factors of the larger equation. There are several other factors including:    

  • Suppliers: demand, supply constraints, product availability; 
  • Warehouse:  demand, constraints, availability, logistics; 
  • Store: space availability, promotions, workforce availability, pricing; 
  • E-Commerce: sourcing decisions, inventory availability, pricing; 

Whatever your inventory challenges, ask yourself these questions to see if 4R’s One Predictive Engine can help you. 

  1. Do you have more excess inventory than you expect at times, or all the time…eating into your profits? 
  2. Are you often missing some items, or out of stock, possibly resulting in a poor customer experience? 
  3. Are some stores better at planning inventory and controlling lost sales than others? 

The 4R One Predictive Engine is a significant step forward in the journey toward supply chain planning and inventory optimization. It’s a sole source of true demand and can balance the cost of being out of stock versus having the optimal service levels. Retailers need an engine that puts demand at the core of their supply chain and merchandising planning to drive better forecast and decision-making across their business, resulting in delivering a better customer experience.