Careers in Logistics: How to Become a Demand Forecaster
A single broken link within a supply chain is enough to throw a business into chaos. By anticipating economic shifts and preparing accordingly, demand forecasters help companies avoid over- or under-stocked items, better serve customers and avoid catastrophic disruption.
Let’s see how a great demand forecaster sets the tone for the entire supply chain, including the different types of forecasting and key characteristics required to excel in this role.
Demand Forecasting: The Backbone of Strategic Planning
At its core, demand forecasting is about addressing consumer demands while mitigating potential disruptions — and doing so as efficiently as possible.
As the first line of defense against supply chain upheaval, forecasters are generally logistics professionals with some experience serving in other senior positions. Their day-to-day work usually includes elements of complex data analysis, procurement, material resource planning and inventory management.
Much of a demand forecaster’s time is spent weighing variables that could influence a company’s near-term outlook and determining how best to prepare against them. They also consider past sales metrics and recent customer feedback when determining how to keep goods stocked at optimal levels.
Are Demand Forecasters and Demand Planners the Same?
Demand forecasting and demand planning can refer to the same role or two distinct positions, depending on the organization. In cases where the roles are separate, forecasters typically serve as analysts plotting out a company’s pending needs, while demand planners are tasked with the step-by-step implementation necessary to meet those needs in time.
Where Do Demand Forecasters Get Their Data?
- Identifying past patterns and current sales trends
- Conducting market research and evaluating commonalities in customer feedback
- Performing competitive market analyses
- Speaking with outside experts and other industry professionals
- Applying mathematical formulas to compare multiple sets of data
What Are the Different Types of Demand Forecasting?
Passive Demand Forecasting: The simplest type of demand forecasting, where a company’s past sales data is used as a baseline template for future sales and seasonal demand surges. This method is great for companies with an established sales history and fairly evergreen products or services — for newer or rapidly growing companies, past sales data probably won’t provide an accurate measure of pending demand.
Active Demand Forecasting: Active forecasting merges available data from market research, economic trends and industry-wide growth projections to produce an approximate business outlook.
Short-Term Projections: Using real-time sales data, a short-term forecast helps direct the day-to-day business operations for the next 3-12 months.
Long-term Projections: Through market research and sales data, long-term forecasts generally cover anywhere from 1-4 years. They are built to help executives make informed decisions regarding investments, acquisitions and partnerships to improve the growth trajectory of the business.
Macro Forecasting: This type of projection considers how broader economic trends like the anticipated availability of raw materials or the potential impact of political strife in a given region might impact a business’ larger, longer-term goals.
Micro Forecasting: Focuses on a single aspect of a business’ future, such as demand for a specific product or the risk of manufacturing delays within a certain region.
How Is AI Changing Demand Forecasting?
Considering how much of a forecaster’s role revolves around analyzing data and finding patterns, AI’s growing presence in this space shouldn’t come as a surprise. Today’s demand forecasters work hand-in-hand with AI and machine learning software to augment their forecasts and help businesses meet demand without overspending.
Common uses for AI in forecasting include:
- Automatic ordering plan updates
- Lead time status changes
- Data consolidation
- Enhanced inventory visibility
- Providing actionable recommendations
While AI is a useful tool in the hands of a skilled forecaster, several challenges requiring real human insight and an ability to contextualize information remain. AI forms its projections from historical data, which means any inaccuracies (or too small a sample size) can throw it severely off-course.
AI also doesn’t account for developing trends, seasonal variations or events differing from years past (consider the potential for disruption during the U.S.-hosted 2028 Olympics). That’s on top of the standard technical difficulties associated with integrating, customizing, securing and maintaining AI tools.
In short, AI in its current state is a forecasting facilitator — not a replacement.
Becoming a Demand Forecaster: Job Outlook & Requirements
It doesn’t take long for companies striving for improved supply chain resiliency to find themselves seeking a qualified demand forecaster — and considering “resiliency” is a near-universal business objective, career opportunities in this field (predictably) abound.
According to career intelligence site Zippia, demand forecasting roles* will only grow more valuable in the years ahead:
- About 54,100 new demand forecasting jobs are projected over the next decade.
- Demand forecaster salaries have increased by 3% in the last 5 years, to a new annual average of $82,287.
- There are more than 15,621 demand planners currently employed in the U.S. compared to 27,351 active demand planner job openings.
*Note: Career sites often list forecasting jobs under a number of same-but-different titles, including demand planners, resource planners, demand analysts, forecasting analysts and basically any combination of those same few words.
In addition to those familiar core attributes that make any good logistics professional (clear communication, attention to detail, efficient multi-tasking, adaptability and so on), demand forecasting roles call for a few additional qualifying factors:
Recommended Education & Experience
Though not strictly a requirement, three out of every four demand forecasters earn at least a bachelor’s degree. Degrees in economics, business administration, computer science, sales, supply chain management or any discipline emphasizing analytical skills lend themselves to a successful logistics career.
Forecaster positions also generally require multiple years of hands-on supply chain management experience. It’s most often considered a senior-level position for candidates who’ve cultivated a working knowledge of a company’s products and markets in their previous roles.
Available Certifications
Forecasting positions tend to be reserved for logistics professionals with a strong professional track record. However, there are a few certifications that can vouch for a less-experienced candidate’s expertise:
Certified Forecaster and Demand Planner (CFDP): This certification course is available directly through ISCEA.org for $1,195 and includes 21 guided modules, an accelerated review workshop and a proctored online exam. It can also be earned through this 12-week program on edX for $1,454.
Certified Professional Forecaster (CPF) & Advanced Certified Professional Forecaster (ACPF): Acquiring a CPF requires passing a trio of IBF.org exams on standard operating procedures, data management and basic forecast modeling. However, only candidates with a bachelor’s degree and a full year of professional experience (or two years of professional experience in lieu of a degree) can register for the exams.
The ACPF requires the CPF, plus passing another set of exams on advanced modeling and the growing role of AI forecasting. Students can earn a CPF-C by passing the necessary exams and upgrading to full CPF status after a year on the job.
The first set of exams can be taken together in a bundle for $1275 — just remember, each individual exam must be passed with a score of at least 70%.
Certified in Production and Inventory Management (CPIM): The CPIM is one of several APICS certifications available through the Association for Supply Chain Management (ASCM). The ASCM offers a certification prep course and a two-part CPIM exam for $1,690 each — though the self-study prep course is optional, and various memberships or upgrades are available to save a few bucks.
Careers in Demand Planning & Forecasting
Demand forecasting helps businesses maintain confidence in their future. Without the insights accurate forecasts provide, businesses can’t effectively respond to changing market conditions and may incur additional costs that could have easily been avoided.
Interested in a logistics career? Check out our careers page for details on working with First Call, and don’t miss hearing directly from the FCL team in our Q&A Series!
Join The First Call Crew
Want to build a career somewhere you can make a real impact? Consider joining the team at First Call Logistics. As a fast-growing 3PL, we’re expanding our footprint and hiring for multiple roles.
To learn more about our open opportunities, visit our careers page and apply today!
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