Sales Forecasting and its Methods

1. Sales Forecasting and its Methods
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By-
MITHISAR

2. Sales Forecasting
It is the process of estimating future sales.
According to American Marketing Association,
“Sales forecast is an estimate of Sales, in monetary
or physical units, for a specified future period under
a proposed business plan or programme and
under an assumed set of other forces outside the
unit for which the forecast is made.”
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3. IMPORTANCE OF SALES
FORECASTING
 Enables a business organization to work systematically.
 Enables the production manager to set target for his workers.
 Helps to determine the production capacity that is actually required.
 Helps to cut down wasteful expenditure.
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4. Steps of Sales
Forecasting Process:
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Setting Goals for
Forecasting
Gathering Data
Evaluation of
forecasting
outcomes
Analysis of Data
Forecasting
Choosing the
best model for
forecasting

5. SALES FORECASTING
METHODS
QUALITATIVE METHODS
QUANTITATIVE METHODS
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6. QUALITATIVE FORECASTING
METHODS
Qualitative Methods are primarily subjective and rely on human
expertise and judgement.
Different qualitative techniques are:
 Jury of Executive Opinion
 Sales Force Opinion
 Test Marketing
 Consumers’ buying Plan
 Delphi Method
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7. QUANTITATIVE FORECASTING
METHODS
Time-Series
◦ Trend Analysis
◦ Seasonal Adjustment
◦ Cyclical Analysis
◦ Random Components
◦ Decomposition
◦ Graphical method
◦ Econometric Modelling
◦ Lifecycle Modelling
Causal
◦ Regression Analysis
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8. LIMITATION
The Tastes and preferences
Economic conditions
 Political conditions
Entry of competitors
Progress in science and technology
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9. Thank You
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