What is the practice of making predictions about future demand called?

The practice of making predictions about future demand is referred to as forecasting. This process is critical in supply chain management as it helps organizations anticipate customer needs and adjust their operations accordingly. By utilizing historical data, market trends, and statistical methods, businesses can make informed estimations about what products will be needed and in what quantities. This enables efficient inventory management, optimized production schedules, and better customer service by ensuring that the right products are available at the right time.

Forecasting goes beyond merely estimating; it involves comprehensive analysis and often complex modeling to account for various factors that might influence demand. It is an essential element in strategic planning, allowing companies to align their resources and capabilities with expected market conditions, reducing the risk of overstock or stockouts, and ultimately improving profitability.

Other options like planning, estimating, and analyzing, while related to the wider context of managing operations and supply chain activities, do not specifically capture the predictive aspect of anticipating future demand as precisely as forecasting does.