demand management activities in any global supply chain consist of three activities: demand management, demand planning, and sales forecasting management (Mentzer and Moon 2004b). The role of sales forecasting
changes depending on the position in the supply chain that a company occupies. Any supply chain has only one point of independent demand—or the amount of product demanded (by time and location) by the end-use customer of the supply chain. Whether this end-use customer is a consumer shopping in a retail establishment or online (B2C), or a business buying products for consumption in the process of con- ducting their business operations (B2B), these end-use customers determine the true demand for the product that will flow through the supply chain.
The company in the supply chain that directly serves this end-use customer directly experiences this independent demand. All subsequent companies in the supply chain experience a demand that is tempered by the order fulfillment and purchasing policies of other companies in the supply chain. This second type of supply chain demand is called derived demand because it is not the independent demand of the end-use customer but rather a demand that is derived from what other companies in the supply chain do to meet their demand from their immediate customer (i.e., the company that orders from them).