The IKEA supply chain is mainly make-to-stock (MTS) and only a few
products are made to customer orders. Consequently, the entire supply chain
is heavily dependent on forecasts. The regions and the stores have
traditionally had a strong power and a high degree of local freedom in terms of
planning and placing replenishment requests. This has led to a fragmented
supply chain planning with local optimization and a lot of manual intervention
with plans throughout the supply chain. Furthermore, due to frequent shortage
situations some regions have purposely overestimated demand to ensure
delivery, which in turn has led to imbalance in terms of demand coverage