Always running behind on purchasing? Too much stock of slow movers and shortages of bestsellers are often the result of unreliable demand planning or forecasting. In this article, you’ll discover 7 clear signals that your current approach needs work, and how the right insights can help you purchase faster, smarter, and more profitably.

7 signs your demand planning and forecasting need improvement

• Unpredictable sales spikes:  Unpredictable peaks can lead to stockouts.
• High stock holding costs: Capital is tied up in products that don’t sell or sell slowly.
• Too many return requests: An overstock or shortage leads to frustrated customers who are more likely to return.
• Lost sales opportunities: Lost sales often stem from inaccurate forecasts and inventory levels that don’t match demand.
• Little insights into future trends: Without visibility into upcoming trends, creating a reliable forecast becomes nearly impossible.
• Manual processes and errors: Excel and disconnected systems make your forecasting slow and error-prone.‍
• Low customer satisfaction: Unreliable delivery times and poor product availability hurt your brand.

Curious to learn more? The rest of the article breaks down each sign and offers practical tips to solve them.

How to keep your demand planning on track

For e-commerce buyers and business owners, anticipating customer demand is essential. With effective demand planning and accurate forecasting, you not only avoid lost sales but also keep inventory costs under control, allowing you to consistently and efficiently meet customer needs.

Strong demand planning starts with well-structured purchasing and inventory processes. Even small gaps can lead to excess stock or costly shortages. That’s why it’s your job as a buyer to spot the early warning signs of an inefficient approach.

In this article, we’ll walk you through seven clear signals to watch for. Recognize and address them in time, and you’ll keep your inventory management under control while setting the stage for sustainable growth.

7 signals for e-commerce buyers to improve demand forecasting

Often, subtle signs creep into your processes that indicate your demand planning or forecasting isn’t performing at its best. When you can recognize and address these signals, you’ll be able to predict demand more accurately—and meet it more effectively. Let’s take a closer look at each one.

1. Unpredictable sales spikes

One of the most common challenges for purchasing teams is unexpected fluctuations in sales. Unpredictable peaks can lead to stockouts, products being unavailable exactly when customers want them most. This not only hurts your revenue but also damages customer satisfaction.

With the right forecasting approach, you can better anticipate peaks and fluctuations in demand. This enables you to keep your inventory balanced and under control. A strong example of improved forecasting is combining historical sales data with external factors such as seasonal patterns, marketing campaigns, economic trends, and even the weather.

2. High stock holding costs

High stock holding costs can take a serious toll on your bottom line. If you want to make the most of every square metre of warehouse space, you need to avoid letting products sit idle for too long.

Overstocking also increases the risk of products becoming outdated, expiring, or simply unsellable due to changing trends. High inventory costs are often caused by carrying too much stock or failing to adjust in time.

By applying effective demand planning, you can purchase exactly what’s needed and avoid unnecessary storage expenses. For example, analyzing product turnover rates and reducing slow-moving stock helps you lower the risk of obsolescence while freeing up capital for growth, marketing, or new product lines.

3. Too many return requests

When your demand planning strategy and forecasts aren’t accurate, it can easily result in an overstock or shortage of certain products. This frustrates customers, who expect their orders to arrive on time and in perfect condition.

When this doesn’t happen, complaints and return requests often follow—both of which can seriously harm customer satisfaction. By using advanced software with algorithms and real-time data, you can forecast demand much more accurately.

This ensures you’re purchasing the right quantities of each product and delivering exactly what customers expect. It doesn’t just reduce returns, it also improves the overall customer experience.

4. Lost sales opportunities

In e-commerce, you want to seize every opportunity to sell, and that means avoiding out-of-stock situations. Lost sales often stem from inaccurate forecasts and inventory levels that don’t match demand.

When customers see the dreaded “out of stock” message, they’re quick to click over to a competitor, often never to return, especially when it comes to popular products.

Accurate demand planning ensures you always have your bestsellers, such as seasonal items, promotions, or new releases, ready when demand peaks. This prevents missed revenue and builds customer loyalty. Shoppers perceive your store as reliable and are more likely to return, knowing they’ll find what they’re looking for.

5. Little insight into future trends

In a dynamic e-commerce sector, a trend can emerge today and become mainstream by tomorrow. Without visibility into upcoming trends, creating a reliable forecast becomes nearly impossible.

You risk missing opportunities to tap into new product categories, shifting consumer preferences, or seasonal changes, giving competitors the upper hand. Integrating trend analysis into your demand planning transforms purchasing from a reactive process into a proactive strategy.

Smart software, such as Optiply, can combine historical sales data with predictive models and external signals, like social media buzz or search trends, to identify emerging products early. This lets you stock up well in advance and ride the wave of the next big trend.

6. Manual processes and errors

Relying on spreadsheets and manual data entry is a risky choice. It’s time-consuming, error-prone, and limits your ability to respond quickly to shifts in demand. One wrong formula or typo can throw off your entire forecast, leading to either missed sales or an overstuffed warehouse.

By automating your demand planning and forecasting, you can process large volumes of data in seconds and turn them into accurate predictions. This minimizes human error, speeds up decision-making, and frees your time for strategic purchasing, like negotiating with suppliers or exploring new growth opportunities.

7. Low customer satisfaction

Happy customers are the driving force behind your e-commerce business, and poor forecasting can have a direct impact on that. If you can’t meet (or exceed) customer expectations, disappointment, complaints, and negative reviews are inevitable.

Customers expect a smooth buying experience, and stock issues or delivery problems can quickly erode trust in your brand.

Accurate forecasting and smart inventory optimisation ensure that popular products are available exactly when customers want them. This builds trust, increases the chances of positive reviews, and makes customers more likely to return for their next purchase.

The role of AI tools in improving demand planning and forecasting

Advanced AI tools for inventory optimisation can address each of the seven challenges above. By combining powerful algorithms with deep data analysis, these tools significantly improve forecast accuracy. Using multiple forecasting models within one system allows them to better predict demand and optimise your stock levels.

Why 500+ e-commerce businesses choose Optiply

Optiply doesn’t just forecast demand, it turns insights into direct purchasing actions. The platform uses historical sales data, seasonal patterns, current trends, and external factors to create concrete purchasing advice at SKU-level. With more than 40 forecasting models, Optiply automatically determines what to buy, in what quantities, and at what moment. This leads to:

• Higher forecast accuracy by leveraging 40+ forecasting models.
• Fewer stockouts thanks to optimal inventory levels at the right time.
• Lower inventory costs by reducing overstock.
• Time savings for purchasing teams through automation of repetitive tasks.
• Higher customer satisfaction with consistent product availability.

With Optiply, forecasting becomes a concrete, daily purchasing strategy. You reduce costs, boost revenue, and turn demand planning from a challenge into a competitive advantage. Curious about the results? Be inspired by our case studies.

Curious how it works? Book a free demo and see in just 15 minutes how to optimise and automate your forecasts, and keep your inventory under control.