Abnormal Demand: The Daily Definition
What is abnormal demand?
Abnormal demand is an unexpected level of customer interest that businesses might find difficult to handle. This demand may come from a new customer or from existing customers whose own demand is increasing or decreasing.
There are a handful of reasons why a company might experience abnormal demand, and it’s essential that they take the time to diagnose the cause. It could be an internal reason, such as a new promotion your company is trying out. However, this could also be attributed to external causes, one of which we’ll dive into below.
For the sake of timeliness, we’ll use an example that’s relevant to all our lives now. Let’s look at our current shortage of sanitary face masks in the midst of COVID-19. Since the swift spread of the virus, many citizens took to stocking up on essential items, and businesses have found themselves ill-prepared for that level of demand. A global health threat is certainly nothing that any manufacturer could ever predict, so their normal inventory levels weren’t sufficient.
Our two cents:
Abnormal demand doesn’t always come in the form of crisis. It can originate among any of your customers, and in varying levels of severity.
While abnormal demand is unpredictable by nature, there are ways that warehouse managers can better prepare themselves to address it. The more in touch you are with your inventory, the easier it is to identify any abnormalities. The sooner you can identify these, the sooner you can address them.
Above all, if you want to be able to adapt, visibility into your inventory is absolutely essential. This is something that you can’t achieve without a clear strategy for managing your products. Check out our quiz here to determine if you’re tracking or managing your inventory, and which is better suited for your needs.