The model, as a basis for forecastingdemand for AGC to buy, is necessary for decision making to ensure that the AGC system put in or capacity purchased and actual demand achieve real-time balance.
Even though manufacturers and retailers can forecast aggregate demand with some certainty, forecasting accurately how that demand will be distributed among the many SKU's they sell is difficult.
The company started by envisioning the business system as a whole and chose to focus on a very few high-leverage points: distribution, demandforecasting, and customer service.