When defining an allocation strategy, retailers need to consider the ideal life of a product. This is especially important when managing seasonal items that are expected to sell for a set period of time and ideally be out of stock by the end of that time period. By defining the start and end date of an allocation strategy, sell through and end of life inventory can be projected allowing for various optimization strategies to be applied to reduce end of life inventory.

The start date for an allocation strategy defines the date on which you would initially like to start selling the product in a location. The lead time and supply chain will ensure the inventory is available in advance of this start date.

The End date is the ideal date on which you would like to stop selling a product. The end date can be left blank on an allocation strategy defined for a core product and will continue recommending allocations as long as there is inventory available to allocate.

Note that there are system defaults to limit forecasting past a certain number of weeks as the accuracy of allocations will invariably decrease over time and it often doesn’t make sense to forecast more than 10 to 15 weeks into the future.

The demand forecast will stop at the end date, this allows for the calculation of ending inventory within the desired life of the product.

The phase out date allows users to specify a date on which allocations will cease to stores. After this date, the system will continue to project sales and opening/closing inventory for each week but will no longer allocate inventory to the locations in question.

The phase out date offers users the flexibility to cut stores early if they are underperforming, guaranteeing remaining source inventory is available for other stores. Users may also choose to phase out full price stores as they transition inventory to outlet stores, and many other strategies.

Phase out dates can be set for the entire strategy but can also be set by store.

The image below shows the impact of phasing out Store 1, before the other stores and the projection of sell-through over time.

Manipulating start and end dates, as well as phase out dates provides users with the flexibility and control over their allocation strategies and the ability to review the impact in real time as they adjust to business conditions.