Sanjaay Gowda T S
The Coca-Cola Company practice

ORIGINAL COMPANY-CONTEXT PRACTICE

Distinguish distributor ordering from consumer demand

Data scienceHardConcept

Original practice scenario: A hypothetical beverage producer sees a surge in distributor orders before a promotion. How would you test whether it reflects consumer consumption or inventory accumulation?

Written for independent practice using company context; this is not a verified question from a company interview.

A REASONED APPROACH

Model answer.

Treat orders, shipments, channel inventory and consumer sales as different signals. Upstream ordering can shift demand between periods without a corresponding change in final consumption.

Work through it

  1. Align the product, channel and time grains, documenting coverage and reporting delays for inventory and downstream sales rather than assuming complete visibility.
  2. Compare ordering changes with sell-through, stock levels, promotion timing and later replenishment, using seasonal baselines and consistent product specifications.
  3. Evaluate whether a surge is followed by lower orders or inventory drawdown, reporting uncertainty where downstream observations are missing.

Tradeoffs to discuss

  • Upstream orders arrive quickly but are influenced by purchasing behavior; consumer sales are closer to consumption while often delayed or incomplete.

Common pitfalls

  • Do not label promotional pipeline filling as a permanent increase in demand.
  • Changes in distributor coverage or shipment allocation can mimic growth even when comparable consumer activity is unchanged.

KEEP PRACTISING

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