Manufacturing suppliers will typically request an annual forecast from their customers. While this process takes time, suppliers absolutely need this information to ensure they have the capacity and production wherewithal to meet your product manufacturing needs throughout the year. They use the information to determine their materials, equipment and workforce requirements.
But what happens when your previously shared forecast changes during the year? Do you notify your suppliers when you anticipate changes, or do you wait until you are ready to submit your next purchase order?
Think about it this way, no matter if it is March, July or October, any time of year is a good time to notify your suppliers about significant changes to your forecast. The sooner your supplier knows about your change of plans, the more likely they will be able to make adjustments to meet your needs.
Factors Not Forecasted
What unforeseen circumstances could prompt you to change your forecast? We are experiencing many changes in the world today, including political maneuvers regarding international trading. The tariffs on aluminum and steel, along with the Russian sanctions, are issues manufacturers are currently facing that were unexpected at this time last year. These issues alone can affect product manufacturing costs and availability, that is if the raw material we need to make your products is available.
The following factors that could change your forecast include a few hot issues in today’s marketplace.
- Skilled workforce shortage
- Product launch/end of life cycle
- Unexpected increase/decrease in product demand
- Unexpected events affecting operations or services (e.g. safety issue, worker strike, equipment change-outs, or product recall)
- Unavailable material
- Tariffs, levies, tax increases
- Regulatory issues
- Sanctions (e.g. Russian sanctions)
- Severe weather damage
When you submit your annual forecast, we will ask you to share possible known factors that could change your forecast. This helps us plan, and make adjustments.
Nuances of Forecasts
At Alexandria Industries, we work hard to stay aware of, and think through, the potential issues that can play a critical role in our ability to supply product to customers. Changes in your forecasts can have a significant impact on our business. Our having open capacity is not necessarily a given.
If one, two or ten, customers each suddenly increased their volumes, we would need to adjust production schedules, material and tooling orders, and possibly even employment levels. More so, a trickle-up-effect can affect our own suppliers’ abilities to meet changing supply needs.
When your forecast changes, good communication is the first step. Have a conversation with your Alexandria Industries account executive to discuss possible solutions. Prompt updates from you will increase our ability to serve you, as we will make every attempt to accommodate your new time frame.
The Best of Us
Alexandria Industries has put systems and best practices in place to assist customers whose plans change mid-year. To ensure the flexibility to adjust to your forecast changes, we strive to have:
- The right amount of raw material to absorb sudden increases in production volumes
- Spare capacity to meet last-minute, urgent customer requests
- Proper equipment to do our work, and plans for new equipment expenditures
- Skilled and properly trained employees
- Up-to-date IT/IS systems
- Available and flexible logistics
We understand things change, and we work hard to be the best supplier by meeting your unplanned needs.
Open communication is key. Our account representatives work closely with customers to meet your unplanned needs, and assist us in planning for the future. Feel free to contact them any time.