Certified Logistics Associate (CLA) Practice Test 2026 - Free CLA Practice Questions and Study Aid.

Question: 1 / 400

What does effective demand planning prevent?

Understocking of products

Overstocking of products

Effective demand planning is crucial in supply chain management as it aligns inventory levels with actual customer demand. By accurately forecasting demand, organizations can ensure they have the right amount of stock available when needed. Preventing overstocking of products is essential because it not only ties up capital in unsold inventory but can also lead to increased storage costs and waste, especially for perishable items.

Furthermore, effective demand planning helps maintain a balance in inventory levels, thereby minimizing instances where too much stock accumulates. Overstocking can lead to markdowns or clearance sales, which negatively impact profit margins. Through careful analysis of sales data and market trends, effective demand planning ensures that a company maintains optimal inventory levels, ultimately contributing to operational efficiency and better customer satisfaction.

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Delayed shipping times

Excessive transportation costs

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