Three months after a redesigned pack went on sale, one plant still held 18,000 labels for the old version and two pallets of old stock sat unsold at a depot. Nobody had ordered them on purpose. The planning system did it, because the old item was still active with every reorder setting intact.

Product changes look like a marketing event. For planning, they are a data event with dates attached.

Why Does the Old Item Keep Getting Ordered?

An item master entry does not know a replacement exists. Its safety stock, reorder point and supplier lead times stay live until someone changes them. Forecasts keep running off its sales history. Open purchase orders for its unique components carry on arriving. Customers with standing orders may keep quoting the old code for weeks.

Each of these sends a signal into the plan, and the plan obeys. Phase in phase out planning exists to switch those signals off in the right order, and to switch the new item’s signals on at the right moment.

How Should the Cut-Over Date Be Set?

Start from the stock that has to sell. Take an illustrative item with 3,000 units on hand and 1,000 more in production, selling about 800 a week. That is 4,000 units, or five weeks of demand. If marketing plans the switch in six weeks, one week of demand has no stock behind it. Two answers exist. Run one small final batch of the old item, or bring the cut-over forward a week. The second is usually cheaper, because a final batch creates fresh leftovers of unique components.

Once the date is agreed, change the item status. Block new production and purchase proposals for the old item from that date, while still allowing sales from stock. Record the link between the two codes as well, so reports and forecasts can treat them as one family.

What Happens to Components?

Split the bill of materials into shared and unique parts. Shared parts, such as a common base material, simply move to the new item. Unique parts need attention:

• Cancel or cut open purchase orders for labels and cartons used only by the old item.
• Calculate the exact quantity needed for any final batch, and order no more.

Supplier minimum order quantities often force some excess. Agree with the supplier early whether part of the last order can be cancelled or returned. Printed items not yet run are the easiest to stop. Write off any leftover units in the same month, so the cost sits with the product change that caused it.

How Is the New Item Forecast Without History?

A new item starts with no sales record. The common fix links it to the item it replaces and borrows that history, adjusted for known differences. A price rise of 10% might justify starting at 90% of the old volume. A larger pack might sell fewer units at a similar total weight. Good AI demand forecasting software for manufacturers supports this kind of linked history and shows the planner which assumption drives the number.

Adoption also ramps up. Retailers and distributors sell through old stock first, so new item demand often starts slowly and climbs over several weeks. A forecast that assumes the full volume from week one fills the warehouse with new stock while old stock is still moving. Track both items as one family during the overlap. Combined demand should stay close to the old item’s normal level. If the family total drops, the launch is losing customers, which is a commercial problem worth flagging early.

How Do Depots Fit In?

Depots hold their own stock of the old item. Shipping new stock before old stock clears leaves two versions competing for shelf space. Set a simple rule, such as releasing new stock to a depot only when its old stock falls below two weeks of cover.

Returns need a plan too. Old stock sent back by distributors after the cut-over has to go somewhere, either through a clearance channel or into a write-off, and finance should know which before launch day.

Who Owns the Checklist?

Phase in phase out planning cuts across several departments, from marketing to the depots. Name one coordinator per product change, with a checklist that runs from status codes to depot rules. Review it at each planning cycle until the old item reaches zero stock. AI demand forecasting software for manufacturers then picks up the new item with a clean history, and the old one stops generating orders.

Planning a product change soon? Talk to Oritiq about a scoped pilot covering the full cut-over.