Which planning strategy is best used for products with highly variable demand?

The best planning strategy for products with highly variable demand is the make to order approach. This strategy is specifically designed to cater to the unique and unpredictable needs of customers. When demand is highly variable, it becomes challenging to forecast accurately, making it difficult to hold inventory that aligns with actual sales.

By using a make to order strategy, production begins only after an order is received. This ensures that the company is not overproducing or holding excess inventory that may not be sold, which is a significant risk when demand is uncertain. In addition, this strategy allows businesses to customize products according to individual customer preferences, enhancing customer satisfaction and reducing the chance of excess stock that does not align with the market needs.

In contrast, other strategies, such as make to stock, focus on predicting demand and producing products ahead of time, which can lead to excess inventory under high variability. Planning with consumption and assemble to order also do not adapt as well to unpredictable demand, as they may require maintaining stock levels or preparing assembly components ahead of time, which may not suit a highly variable demand scenario.