# Sales and Operations Plan: [Business unit], cycle [YYYY-MM]

> A monthly sales and operations planning (S&OP) pack: portfolio review,
> demand review, supply review, inventory and service projection,
> financial reconciliation, scenarios, the executive decisions and the
> actions that follow. It follows widely used S&OP practice as taught
> by supply chain bodies such as ASCM (Association for Supply Chain
> Management); no single standard governs S&OP. Replace every
> `[bracketed]` value and every row marked *Example*. Figures in the
> examples are invented and are not benchmarks.

<!--
Guidance: How to use this template
- Copy this file once per monthly cycle (for example
  `sop-2026-11.md`) and keep the previous cycles: the trend of
  forecast accuracy and decisions is part of the value.
- Plan in aggregate: product families, sites and months, not SKUs and
  days. Detailed scheduling happens after S&OP, inside the plan the
  executives approve here.
- Fill sections 4 to 8 during the working steps of the cycle, section 9
  at the pre-S&OP meeting, and section 10 at the executive meeting.
- Keep one set of numbers. Demand, supply and finance must use the same
  units, the same family definitions and the same calendar.
- Common pitfall: turning S&OP into a forecast meeting. The purpose is
  a decision on the balance of demand, supply and money, recorded with
  an owner, not a debate about last month.
-->

## Document control

<!-- Guidance: One document per cycle. The process owner keeps the pack; the executive sponsor signs off the decisions in section 10. -->

| Field | Value |
|---|---|
| Document ID | [SOP-2026-11] |
| Cycle | [November 2026 cycle, horizon Nov 2026 to Oct 2027] |
| Version | [1.0] |
| Status | [Draft / Pre-S&OP agreed / Executive approved] |
| Process owner | [@sop-process-owner] |
| Executive sponsor | [@general-manager] |
| Business unit and sites | [Business unit, plants, distribution centres] |
| Units of measure | [Units, cases, tonnes; currency] |
| Last updated | YYYY-MM-DD |
| Next cycle starts | YYYY-MM-DD |
| Classification | [Confidential: contains forecasts and financial plans] |

### Approvals

| Role | Name | Decision | Date |
|---|---|---|---|
| Executive sponsor | [@general-manager] | [Approved / Approved with changes] | YYYY-MM-DD |
| Finance lead | [@finance-director] | [Agreed] | YYYY-MM-DD |
| Sales lead | [@sales-director] | [Agreed] | YYYY-MM-DD |
| Operations lead | [@operations-director] | [Agreed] | YYYY-MM-DD |

### Revision history

| Version | Date | Author | Change |
|---|---|---|---|
| 0.1 *(Example)* | 2026-11-12 | S&OP process owner | Demand and supply reviews entered |
| 0.9 *(Example)* | 2026-11-19 | S&OP process owner | Pre-S&OP recommendations added |
| 1.0 *(Example)* | 2026-11-24 | Executive sponsor | Executive decisions recorded |

## Contents

1. Scope and planning horizon
2. Monthly cycle and calendar
3. Roles and decision rights
4. Product and portfolio review
5. Demand review
6. Supply review
7. Inventory and service plan
8. Financial reconciliation
9. Gaps, scenarios and recommendations
10. Executive review and decisions
11. Performance measures
12. Actions and follow-up
13. Glossary
14. References and related templates

## 1. Scope and planning horizon

<!-- Guidance: State what the plan covers and at what level of detail. A horizon of 12 to 24 months is common so that capacity and supplier decisions with long lead times are visible. Questions: which families, which sites, which time fences? -->

| Item | Value |
|---|---|
| Product families in scope | [Family list, for example "Countertop blenders", "Kettles", "Spare parts"] |
| Sites in scope | [Plants, contract manufacturers, distribution centres] |
| Horizon | [18] months, monthly buckets |
| Frozen period | [Month 1]: changes only by exception through the operations lead |
| Slushy period | [Months 2 to 3]: changes need supply review agreement |
| Liquid period | [Months 4 onward]: free to change in the next cycle |
| Planning unit | [Units per family per month] |
| Currency | [Currency] at [budget exchange rates] |

Families should group products that share capacity and have a similar
demand pattern. If two products use different lines or suppliers, they
belong in different families even when marketing groups them together.
Keep the family list stable from cycle to cycle so that trends can be
compared; record any change in the revision history.

The time fences protect the operation from churn. Inside the frozen
period, materials are bought and lines are scheduled, so a change costs
real money. Write down who can approve an exception and how it is
recorded (section 12).

## 2. Monthly cycle and calendar

<!-- Guidance: Publish the calendar for the year in advance. Each step has an owner, a deadline, inputs and outputs. Most organizations run five steps in about four weeks. -->

```mermaid
flowchart LR
  A["Step 1: Data gathering and portfolio review"] --> B["Step 2: Demand review"]
  B --> C["Step 3: Supply review"]
  C --> D["Step 4: Pre-S&OP reconciliation"]
  D --> E["Step 5: Executive S&OP meeting"]
  E --> F["Approved plan to detailed scheduling and budget"]
  F -.->|"Actuals feed next cycle"| A
```

| Step | Working days *(Example)* | Owner | Inputs | Outputs |
|---|---|---|---|---|
| 1. Data gathering and portfolio review | WD 1 to 3 | Demand planner, product manager | Last month actuals, open orders, launch and phase-out list | Updated history, portfolio changes (section 4) |
| 2. Demand review | WD 4 to 7 | Sales lead | Statistical baseline, sales and marketing input, key account plans | Agreed unconstrained demand plan (section 5) |
| 3. Supply review | WD 8 to 11 | Operations lead | Demand plan, capacity, supplier constraints, inventory | Constrained supply plan, constraints list (section 6) |
| 4. Pre-S&OP reconciliation | WD 12 to 14 | Process owner, finance lead | Demand and supply plans, financial plan | Gaps, scenarios, recommendations (sections 8 and 9) |
| 5. Executive S&OP meeting | WD 15 or 16 | Executive sponsor | Pre-S&OP pack | Decisions and approved plan (section 10) |

Rules for the cycle:

- Steps run in order. The supply review does not start until the
  demand plan is agreed, because a moving demand plan makes capacity
  analysis worthless.
- A step that misses its deadline is reported at the executive meeting
  with the reason.
- Decisions that cannot wait for the next cycle follow the exception
  route in section 12; they do not create a second, informal plan.

## 3. Roles and decision rights

<!-- Guidance: Name roles, not people, and say who decides. The common failure is a meeting where everyone attends and nobody decides. -->

| Role | Responsibility | Decides |
|---|---|---|
| Executive sponsor | Chairs the executive meeting, resolves trade-offs | Final plan, scenario choice, budget changes within authority |
| S&OP process owner | Runs the calendar, prepares the pack, tracks actions | Agenda, escalation of late inputs |
| Demand planner | Statistical forecast, accuracy measures | Baseline method and parameters |
| Sales lead | Commercial input, key account plans, demand plan sign-off | Demand plan submitted to supply review |
| Marketing or product lead | Promotions, launches, phase-outs | Portfolio changes proposed for approval |
| Supply planner | Capacity and material checks, constrained plan | Supply options presented |
| Operations lead | Plants, warehouses, logistics capacity | Supply plan submitted to pre-S&OP |
| Procurement lead | Supplier capacity and lead times | Supplier options presented |
| Finance lead | Converts plans to money, compares with budget | Financial view presented, budget variance flagged |

## 4. Product and portfolio review

<!-- Guidance: Record launches, phase-outs and changes that move volume between families. These events are often the largest source of forecast error. -->

| ID | Change | Family | Date | Volume effect | Status | Owner |
|---|---|---|---|---|---|---|
| PRT-001 *(Example)* | Launch of a new blender model | Countertop blenders | 2027-02 | Adds 2,000 units per month from March, replaces older model | Approved | [@product-manager] |
| PRT-002 *(Example)* | Phase-out of the older blender model | Countertop blenders | 2027-03 | Last build in February, sell-through by April | Approved | [@product-manager] |
| PRT-003 *(Example)* | Pack size change for spare parts | Spare parts | 2027-01 | No unit change, pallet count down 8% | Proposed | [@packaging-engineer] |

Questions for this step:

- Which launches and phase-outs fall inside the horizon, and are they in
  the demand plan?
- Is the phase-out stock plan agreed, so that old stock does not become
  obsolete while the new model ramps up?
- Has any change moved demand from one family to another?

## 5. Demand review

<!-- Guidance: Present an unconstrained demand plan: what customers would buy if supply were unlimited. Show the baseline, the overrides, and the assumptions behind each override. -->

### 5.1 Demand plan by family

Family: *Countertop blenders (Example)*, units per month.

| Month | Statistical baseline | Sales and marketing changes | Agreed demand plan | Assumption reference |
|---|---|---|---|---|
| Nov 2026 *(Example)* | 40,000 | +2,000 promotion | 42,000 | ASM-001 |
| Dec 2026 *(Example)* | 47,000 | +4,000 key account listing | 51,000 | ASM-002 |
| Jan 2027 *(Example)* | 36,000 | 0 | 36,000 | n/a |
| Feb 2027 *(Example)* | 34,000 | 0 | 34,000 | n/a |
| Mar 2027 *(Example)* | 36,000 | +2,000 new model | 38,000 | PRT-001 |
| Apr 2027 *(Example)* | 38,000 | +2,000 new model | 40,000 | PRT-001 |
| **Six-month total** | **231,000** | **+10,000** | **241,000** | |

### 5.2 Assumptions

| ID | Assumption | Owner | Confidence | Upside or downside |
|---|---|---|---|---|
| ASM-001 *(Example)* | Retail promotion in weeks 46 to 48 adds 2,000 units | [@marketing-lead] | Medium | Downside: promotion slot not confirmed |
| ASM-002 *(Example)* | A retail chain lists two models from December | [@key-account-manager] | High | Upside: December demand up to 10% higher (5,100 units) if the chain extends to online |

Each override must have an assumption with an owner. If nobody will
own the number, it stays at the baseline.

### 5.3 Forecast accuracy and bias

<!-- Guidance: Measure the plan that was frozen for each month against actual demand, at the family level and at the lag that matters for supply decisions (often one to three months). -->

| Month | Forecast at lag 1 | Actual demand | Absolute error | Absolute percentage error |
|---|---|---|---|---|
| Aug 2026 *(Example)* | 35,000 | 33,100 | 1,900 | 5.7% |
| Sep 2026 *(Example)* | 37,000 | 38,900 | 1,900 | 4.9% |
| Oct 2026 *(Example)* | 40,000 | 36,800 | 3,200 | 8.7% |
| **Three months** | **112,000** | **108,800** | **7,000** | |

- Mean absolute percentage error (MAPE) over the three months: 6.4%.
- Weighted absolute percentage error (WAPE, total absolute error divided
  by total actual demand): 7,000 / 108,800 = 6.4%.
- Bias (total forecast minus total actual, divided by total actual):
  +3,200 / 108,800 = +2.9%, so the plan ran slightly high.

Bias matters more than a single month's error: a forecast that is
always high builds inventory, one that is always low causes shortages.
Agree a tolerance band for bias (for example plus or minus 5%) and
review the causes when the band is breached.

## 6. Supply review

<!-- Guidance: Test the demand plan against capacity, materials and logistics. Show the constrained plan and every constraint that changed it. Present options, not a single answer. -->

### 6.1 Capacity check

| Month | Agreed demand plan | Available capacity | Proposed production | Utilisation |
|---|---|---|---|---|
| Nov 2026 *(Example)* | 42,000 | 44,000 | 44,000 | 100.0% |
| Dec 2026 *(Example)* | 51,000 | 44,000 | 44,000 | 100.0% |
| Jan 2027 *(Example)* | 36,000 | 44,000 | 38,000 | 86.4% |
| Feb 2027 *(Example)* | 34,000 | 40,000 | 36,000 | 90.0% |
| Mar 2027 *(Example)* | 38,000 | 44,000 | 38,000 | 86.4% |
| Apr 2027 *(Example)* | 40,000 | 44,000 | 40,000 | 90.9% |
| **Total** | **241,000** | **260,000** | **240,000** | |

February capacity is lower because of a planned line maintenance week.
December demand is above capacity, so November runs at full capacity to
build stock ahead of the peak.

### 6.2 Constraints and supply options

| ID | Constraint | Effect | Option | Cost or risk | Owner |
|---|---|---|---|---|---|
| CON-001 *(Example)* | Assembly line capacity 44,000 units per month | December demand 7,000 above capacity | Pre-build in November (in plan) | Extra holding cost for one month | [@operations-lead] |
| CON-002 *(Example)* | Motor supplier allocation | Supplier confirms 48,000 motors per month | Second source qualification | 16 weeks lead time | [@procurement-lead] |
| CON-003 *(Example)* | Outbound dock capacity in December | 2,600 pallets per week | Saturday shifts in weeks 49 to 51 | Overtime cost | [@warehouse-manager] |

Questions for this step:

- Which constraint binds first if demand is 10% higher than planned?
- Which supplier commitments are confirmed in writing, and which are
  assumptions?
- Can the warehouse and transport network move the volume, not only the
  plant make it?

## 7. Inventory and service plan

<!-- Guidance: Project closing inventory each month from opening inventory plus production minus demand. Compare it with the target range. Inventory below the safety stock line is a service risk; inventory above the maximum is a cash and obsolescence risk. -->

Opening inventory on 1 November: *30,000 units (Example)*. Target range:
*25,000 to 32,000 units, with safety stock of 20,000 units (Example)*.

| Month | Opening | Production | Demand plan | Closing | Within target range |
|---|---|---|---|---|---|
| Nov 2026 *(Example)* | 30,000 | 44,000 | 42,000 | 32,000 | Yes (at maximum) |
| Dec 2026 *(Example)* | 32,000 | 44,000 | 51,000 | 25,000 | Yes (at minimum) |
| Jan 2027 *(Example)* | 25,000 | 38,000 | 36,000 | 27,000 | Yes |
| Feb 2027 *(Example)* | 27,000 | 36,000 | 34,000 | 29,000 | Yes |
| Mar 2027 *(Example)* | 29,000 | 38,000 | 38,000 | 29,000 | Yes |
| Apr 2027 *(Example)* | 29,000 | 40,000 | 40,000 | 29,000 | Yes |

The six-month production total (240,000) is 1,000 units below the
demand total (241,000), which matches the fall in inventory from 30,000
to 29,000.

Service targets to report alongside the projection:

| Measure | Target *(Example)* | Last month *(Example)* |
|---|---|---|
| Order line fill rate | 97% | 96.2% |
| On-time in full (OTIF) to customers | 95% | 93.5% |
| Days of supply at month end | 18 to 24 | 22 |

## 8. Financial reconciliation

<!-- Guidance: Convert the volume plan into revenue, cost and inventory value and compare it with the budget or latest estimate. Finance confirms the numbers, it does not create a separate plan. -->

| Month | Demand plan (units) | Average price *(Example)* | Revenue plan | Budget revenue *(Example)* | Variance to budget |
|---|---|---|---|---|---|
| Nov 2026 | 42,000 | 48.00 | 2,016,000 | 1,968,000 | +48,000 |
| Dec 2026 | 51,000 | 48.00 | 2,448,000 | 2,400,000 | +48,000 |
| Jan 2027 | 36,000 | 48.00 | 1,728,000 | 1,776,000 | -48,000 |
| Feb 2027 | 34,000 | 48.00 | 1,632,000 | 1,680,000 | -48,000 |
| Mar 2027 | 38,000 | 48.00 | 1,824,000 | 1,824,000 | 0 |
| Apr 2027 | 40,000 | 48.00 | 1,920,000 | 1,920,000 | 0 |
| **Total** | **241,000** | | **11,568,000** | **11,568,000** | **0** |

All amounts in [currency]. In this example the six-month revenue equals
budget, but the phasing differs: more in November and December, less in
January and February. Finance should state whether the phasing change
affects quarter results, working capital or covenants.

Other financial lines to check each cycle:

- Inventory value at standard cost against the working capital target.
- Overtime, expediting and premium freight in the supply options.
- Margin effect of promotions and price changes in the demand plan.
- Capital requests that follow from capacity constraints.

## 9. Gaps, scenarios and recommendations

<!-- Guidance: The pre-S&OP meeting resolves what it can and brings the rest to executives as clear choices with cost, risk and a recommendation. Keep to the few decisions that matter. -->

### 9.1 Gaps

| ID | Gap | Size | Time | Resolved at pre-S&OP? |
|---|---|---|---|---|
| GAP-001 *(Example)* | December demand above capacity | 7,000 units | Dec 2026 | Yes, by November pre-build |
| GAP-002 *(Example)* | Upside risk at the retail chain (ASM-002) | Up to 5,100 units | Dec 2026 | No, executive decision needed |
| GAP-003 *(Example)* | Second motor source not qualified | Capacity risk above 48,000 per month | From Mar 2027 | No, executive decision needed |

### 9.2 Scenarios

| Scenario | Description | December closing inventory | Service risk | Cost |
|---|---|---|---|---|
| A. Plan *(Example)* | Agreed demand plan, production as in section 6 | 25,000 | Low | In plan |
| B. Upside, no action *(Example)* | December demand +10% (56,100) | 19,900, below safety stock of 20,000 | Medium | None |
| C. Upside with overtime *(Example)* | As B plus 4,000 overtime units in December (48,000 built, within the motor allocation in CON-002) | 23,900 | Low | 10,000 overtime (4,000 units at 2.50) |

### 9.3 Recommendations to the executive meeting

| ID | Recommendation | Reason | Decision needed by |
|---|---|---|---|
| REC-001 *(Example)* | Approve overtime budget for scenario C, to be released only if the retail chain confirms online listing by 2026-11-30 | Protects service at the main customer at low cost | 2026-11-24 |
| REC-002 *(Example)* | Start second motor source qualification now | Removes the binding supplier constraint before the new model ramps up | 2026-11-24 |

## 10. Executive review and decisions

<!-- Guidance: Record the decision, who made it, and what changes in the plan. Keep the agenda short: performance, decisions, risks. Approved plans become the basis for detailed scheduling and the financial forecast. -->

Agenda *(Example, 60 minutes)*:

1. Performance against last cycle: accuracy, service, inventory, actions (10 min)
2. Portfolio changes (5 min)
3. Decisions REC-001 and REC-002 (30 min)
4. Risks and opportunities beyond the slushy period (10 min)
5. Summary of decisions and owners (5 min)

| ID | Decision | Decided by | Plan change | Owner | Date |
|---|---|---|---|---|---|
| DEC-001 *(Example)* | REC-001 approved with a release date of 2026-11-30 | Executive sponsor | Scenario C becomes contingency | [@operations-lead] | 2026-11-24 |
| DEC-002 *(Example)* | REC-002 approved, budget from operations capital | Executive sponsor | Second source in supply plan from Mar 2027 | [@procurement-lead] | 2026-11-24 |

Decisions with lasting effect also go into the business decision log
(`business/decision-log`) with the reasoning.

## 11. Performance measures

<!-- Guidance: Pick a small, stable set of measures and show the trend over at least six cycles. Each measure has one owner. -->

| Measure | Definition | Target *(Example)* | Owner |
|---|---|---|---|
| Forecast accuracy (WAPE, lag 1, family) | Total absolute error divided by total actual | At most 10% | Demand planner |
| Forecast bias | (Forecast minus actual) divided by actual | Within plus or minus 5% | Sales lead |
| Production plan adherence | Produced quantity within plus or minus 5% of plan, by family | 95% of families | Operations lead |
| OTIF to customers | Orders delivered on the agreed date and in full | 95% | Operations lead |
| Days of supply | Closing inventory divided by average daily demand of the next month | Within target range | Supply planner |
| Cycle discipline | Steps completed by their deadline | 5 of 5 | Process owner |

Use the KPI scorecard template (`business/kpi-scorecard`) if the
organization already reports measures in a common format.

## 12. Actions and follow-up

<!-- Guidance: Every action has an owner, a due date and a status. Review open actions at the start of the next executive meeting. Exceptions inside the frozen period are recorded here too. -->

| ID | Action | Owner | Due | Status |
|---|---|---|---|---|
| ACT-001 *(Example)* | Confirm online listing with the retail chain | [@key-account-manager] | 2026-11-30 | Open |
| ACT-002 *(Example)* | Issue request for quotation to two motor suppliers | [@procurement-lead] | 2026-12-05 | Open |
| ACT-003 *(Example)* | Update the budget phasing for November to February | [@finance-lead] | 2026-12-01 | Open |

Exceptions inside the frozen period:

| ID | Date | Change | Requested by | Approved by | Reason |
|---|---|---|---|---|---|
| EXC-001 *(Example)* | 2026-11-06 | Moved 1,500 units from week 46 to week 45 | Sales lead | Operations lead | Customer collection date moved earlier |

## 13. Glossary

<!-- Guidance: Keep definitions short and use the same terms in every cycle. -->

| Term | Meaning in this plan |
|---|---|
| S&OP | Sales and operations planning: the monthly process that balances demand, supply and financial plans at aggregate level |
| Unconstrained demand | What customers would buy if supply were unlimited |
| Constrained supply plan | What the operation can produce and deliver given capacity, materials and logistics |
| Product family | A group of products that share capacity and planning logic |
| Time fence | A boundary in the horizon after which plan changes need more approval |
| Lag | The number of months between the forecast snapshot and the month it predicts |
| WAPE | Weighted absolute percentage error, total absolute error over total actual |
| Bias | Systematic over- or under-forecasting |
| OTIF | On time in full delivery to customers |
| Days of supply | Inventory expressed as days of expected demand |

## 14. References and related templates

<!-- Guidance: Link the templates that hold the details this summary relies on. -->

- ASCM, Association for Supply Chain Management: professional body
  whose education material covers sales and operations planning
  (https://www.ascm.org/). Terms in this template are written in
  original wording.
- Related templates in this library:
  - `mba/mba-supply-chain-guide` for supply chain concepts and terms.
  - `mba/mba-inventory-card` for safety stock and inventory policy.
  - `mba/mba-supply-chain-resilience-card` for scenario thinking about
    disruptions.
  - `logistics/warehouse-sop` and `logistics/carrier-scorecard` for the
    distribution side of the supply plan.
  - `business/decision-log` and `business/kpi-scorecard` for decisions
    and measures.

## Standard and licence note

Based on widely used sales and operations planning practice; no single
standard or law defines the process. ASCM is named as a source of
professional education on S&OP; no text from ASCM or any other
publisher is reproduced. All structure, wording, tables and numbers are
original, and the figures are invented examples, not benchmarks. Check
current guidance from your professional body and your own policies
before use. This is a planning format, not financial advice.

Template licence: MIT.