What Is Sales and Operations Planning (S&OP)?

Sales and operations planning (S&OP) is the process that aligns a company's product, demand and supply plans at an aggregate level with its strategic and financial objectives, ending in one consensus operating plan.

Oracle's documentation for its Sales and Operations Planning cloud product describes the process as continuous and forward-looking. It aligns organizations around an integrated operating plan to meet strategic business goals, and lets planners plan at an aggregate level for strategic time horizons, run quick simulations to evaluate new plans, and select the best plan after comparing it with other plans.

Oracle lays out the business flow in stages:

• Demand planning forecasts what customers will order. In Oracle's S&OP flow, demand plans can be loaded in as measures and are checked in the demand review.
• S&OP balances that demand against supply and the financial plan at an aggregate level, and produces the approved operating plan.
• Material requirements planning (MRP) is detailed planning: it works out which raw materials and components a manufacturer needs, how many and when. Oracle's flow hands the approved S&OP plan to the tactical planning process for execution.

A distributor plans its pump product family for the next quarter.

• Demand review: the forecast is 12,000 units.
• Supply review: 1,500 units are on hand and suppliers have confirmed 9,000 more, so supply is 1,500 + 9,000 = 10,500 units, a gap of 12,000 - 10,500 = 1,500 units.
• Financial review: closing the gap means buying 1,500 more units at $40 each: 1,500 x $40 = $60,000 of extra inventory spend.
• Executive review: leadership compares two plans, buying the extra $60,000 of stock or planning to 10,500 units and accepting longer lead times, and approves one. Purchasing and the warehouse then work to that plan.

Shopify's inventory reports include figures a demand and supply review can draw on:

• Inventory sold daily by product: the average number of items of inventory sold per day by product variant.
• Inventory remaining per product: days of inventory remaining, calculated as the ending quantity divided by the average quantity sold per day, based on the last 28 days of sales.
• Month-end inventory snapshot: the quantity of each product variant in stock at the end of each month.

As of October 28, 2026, Shopify says that starting October 1, 2026, inventory reports measure stock by On hand quantity instead of Available quantity. Reported quantities can be higher than before, and data before October 1, 2026 still displays Available quantity.

Oracle's S&OP flow collects demand data such as sales orders. The Uncap Connect page describes Uncap Connect as the real-time data layer between Shopify, your ERP, and the warehouse floor: inventory, orders, customers, and pricing move the moment they change, not in an overnight batch.

• Safety stock
• ABC analysis
• Sell-through rate
• Inventory turnover ratio
• Lead time

• Oracle: Overview of Sales and Operations Planning
• Oracle: Business Flows for Sales and Operations Planning
• Shopify Help Center: Inventory reports