Sales forecasting

The company sales forecast is the expected level of company sales based on a chosen marketing plan and an assumed marketing environment.

MARKET POTENTIAL
It is the limit approached by market demand as industry marketing expenditures approach infinity for a given marketing environment,

Market Demand
Market demand for a product is the total volume that would be bought by a defined consumer group in a defined geographical area in a defined time period In a defined marketing environment under a defined marketing program Market demand is not a fixed number, but rather a function of stated conditions. For this reason it can be called as the market demand function

Measures of Market Demand

Potential Market: The set of consumers who
profess a sufficient level of interest in a market offer

Available Market: It is the set of consumers who have income , interest and access to a particular offer Target Market: It is the part of pursue. Penetrated Market: the set of consumers who are buying the companys product

Market forecast:
Market demand corresponding to any one level of industry marketing expenditure.

Company sales potential

It is the sales limit approached by company demand as company marketing effort increases relative to that of competition.

Company demand
It is the estimated share of market demand at alternative levels of companys marketing effort in a given time period

Company sales forecast

The company sales forecast is the expected level of company sales based on a chosen marketing plan and an assumed marketing expenditure

Estimating current market demand

Total market potential = Potential no of buyers multiplied by average quantity purchased by a buyer multiplied by price Area market potential:
Market build up method Multiply no of buyers by expected no of purchases, and cost per buyer, to derive forecast figures.. Multiple Factor Index model: Research variables and develop a formula incorporating factors predicting sales volume to derive market index figure.

Industry sales and market shares

Estimating future demand

Qualitative techinques
Survey Methods: Consumers Expenditure Plans, Information from business executives, information about inventory changes.
Opinion Polls: Executive Polling, Sales force opinion, Consumers Intention, Test Marketing,

Computing Annual Sales Forecast

Last year sales Total value of additional contracts you expect to land during the next year Total value of contracts that will not be renewed during the next year. Projected Sales subtotal The percentage increase/Decrease projected by experts for your industry growth Current year sales forecast.

Qualitative Methods
Time Series Analysis: Projects past sales
trends into future periods. Time series forecasting is the use of a model to forecast future events based on known past events:

Corelation analysis :Uses one set of data to forecast another set of highly corelated data.

Econometric Methods