The retail industry is one of the most dynamic in the market, as shopping experiences and consumer behavior are constantly changing. Online shopping, same-day or contactless delivery and in-store pickup are no longer desired services, now they are necessary. Before this growing pressure for business, scenario planning is key.
When planning, a variety of coherent, plausible and different scenarios are considered, and how your business will be able to respond to them. This type of exercise can show how prepared you are as an organization to adapt to unforeseen situations that may jeopardize the operability of the business or its performance.
Benefits of scenario planning
When scenarios are planned, reliable information is available for decision-making. You can also better interpret market changes as well as consumer behavior. There are many ways in which companies can benefit from this process.
Increases business agility
Scenario planning helps organizations become more agile and able to adapt to multiple eventualities. It can reveal the results of key business variables such as supply chain problems or rising raw material costs, for example, to respond to changes accurately and quickly. Imagine you have launched a product that has to be recalled. By planning for this scenario, you will be able to work optimally to achieve that result in the shortest possible time and without too much damage.
Allows optimal allocation of resources
With this tool, managers can be more aware of the state of their company. Thus, they can match internal resources with the external environment to allocate them more efficiently and rationally.
Scenario planning helps to better understand the present by imagining the future. It helps to deal with future uncertainties by being aware of “weak signals” and helping you prepare better to handle new situations to keep the business alive and thriving.
Boosts business growth
Effective forecasting of different scenarios helps to create a broader and more accurate picture of the future of your business. Thus, planning can reveal opportunities for growth and expansion, as well as anticipate any bumps in the road.
Technology, the best partner for scenario planning
Scenario forecasting is crucial for retail companies to remain alert in the face of market uncertainty. Technology can be the best partner to carry it out. An excellent alternative is offered by Oracle EPM Cloud, a software that allows, among many other things, to promote agile and connected plans.
With this tool it is possible to model scenarios across the company, as well as plan for the long term. It allows you to seamlessly connect data from across the organization to generate forecasts and scenarios that are updated as results change. This enables financial teams to make proactive decisions.
At Fusionworks we can help you with the implementation of this solution in companies of the retail industry and other sectors. Contact us!