What is the process involved in the actual allocation of supply to demand?

The process of actually allocating supply to demand centers around the need to balance what is available (supply) with what is needed (demand). This involves collecting and sorting both demand and supply data to understand the current market conditions, inventory levels, and customer requirements. By analyzing this information, businesses can determine how much of their available products to allocate to meet the demand efficiently, ensuring customer satisfaction while maintaining optimal inventory levels.

In contrast, focusing solely on financial data does not provide the necessary insights into inventory and customer needs. Assessing historical data exclusively may give a glimpse into past performance but does not account for real-time changes in supply and demand dynamics. Similarly, calculating inventory turnover, while important for financial metrics, does not directly inform the logistics of allocation between supply and demand. Thus, collecting and sorting both types of data is essential for effective allocation in a supply chain context.