Demand Forecasting

Rule of thumb Scientific analysis

Factors involved in DF
Duration : LT-MT-ST Levels: Macro-Industry-Firm General Forecast or Specific: Steel vs ABC New Product vs Old Product Classification of goods-Consumers & Producers Goods Psychological, sociological, Environmental (Bharat I,II,II) factors

Purpose of DF

Short Term: Appropriate production to avoid over/under production To help a firm in procuring resources at good bargain-Raw mat etc. Setting sales targets To evaluate a suitable advertising policy Develop suitable pricing policy-Recession-low

Purpose
Long Term: Planning a new Unit or expansion of existing one Planning LT financial requirements Planning manpower requirement Technology planning

Methods
Survey of buyers intentions Collective opinion or Sellers survey Controlled Experiments Experts Survey Delphy Method Statistical Methods (Time Series data on sales, Regression analysis)

Criterion for a good DF

Accuracy Simplicity Economy Availability Time frame