What is demand modeling in SAP CA-DDF-RT - Demand Data Foundation for Retail?

SAP Term: demand modeling

• Component: CA-DDF-RT

• Component Name: Demand Data Foundation for Retail

• Description: The process of finding the values for the parameters of a defined statistical model to explain the historical demand. The parameters typically describe the effects of demand influencing factors DIFs. The parameter values can then be used to predict the effects of similar DIF occurrences in the future, a process referred to as demand forecasting.

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• Key Concepts: 
  Demand modeling is a process used in the SAP CA-DDF-RT Demand Data Foundation for Retail component to forecast customer demand for products and services. It uses historical data, market trends, and other factors to predict future demand. This helps retailers plan their inventory and pricing strategies more effectively. 
  
  How to use it: 
  Demand modeling can be used to create forecasts for different time periods, such as daily, weekly, or monthly. It can also be used to create forecasts for different product categories or customer segments. The forecasts can then be used to inform decisions about inventory levels, pricing strategies, and promotional activities. 
  
  Tips & Tricks: 
  When using demand modeling, it is important to ensure that the data used is accurate and up-to-date. It is also important to consider external factors such as weather, holidays, and economic conditions when creating forecasts. 
  
  Related Information: 
  The SAP CA-DDF-RT Demand Data Foundation for Retail component also includes features such as demand planning and inventory optimization. These features can be used in conjunction with demand modeling to further improve forecasting accuracy and optimize inventory levels.