meaning of Demand meaning of Forecasting meaning of Demand forecasting objectives of Demand Forecasting Importance of Demand forecasting Steps in Demand Forecasting Methods of demand Forecasting

1. A Presentation On…
DEMAND FORECASTING…
Presented By: Guided By :
Manjushree Kamble Mr. Prashant Sir
Sidhharth Dhanedhar
Sachin Bhurase

2. What is Demand…?
 Demand is the consumer’s need or desire to
own the product or experience the service.
 It’s constrained by the willingness and ability
of the consumer to pay for the good or service at
the price offered.
 DEMAND = DESIRE + WILLINGNESS +
ABILITY TO PAY (MONEY)

3. What is Forecasting…?
 Forecasting is the process of making
predictions of the future based on past
and present data most commonly by
analysis of trends.

4. What is Demand Forecasting…?
 Refers to the prediction of probable demand for a
product or a service on the basis of the past events and
prevailing trends in the present.
 Demand forecasting is comprised of a series of steps
that involves the anticipation of demand for a
product in future under both controllable and non-
controllable factors.

5. Objectives of Demand Forecasting
 To Achievement of Planned objectives.
 To Preparing Budget.
 To Stabilization of Production and
Employment.
 To Future Expansion Business.
 To Plan Long term Investment Programs.
 To Control of Inventories.

6. Steps in Demand Forecasting
Specifying the objective
Determining the time prospective
Choices of methods for demand forecasting
Collection of data and data adjustments
Estimation and interpretation of results
(Monitoring Results)

7. Importance of Demand Forecasting
 Planning and production analysis.
 Sales forecasting.
 Control of business.
 Helpful for planners and policy makers.
 Planning for Distribution of Resources.
 Helps in avoiding Wastage of Resources.

8. Methods of Demand Forecasting

9. Qualitative Methods
• Involves a group of experts who eventually
develop a consensus
• They usually make long range forecast for
future technologies
Delphi
Method
Merits:
1. Time
saving
2. Useful for
new
product
Demerits:
1. Bias
2. Risk of loss
of
confidential
information

10. Qualitative Methods
• Involves a group of experts who eventually
develop a consensus
• They usually make long range forecast for
future technologies
Delphi
Method
Merits:
1. Time
saving
2. Useful for
new
product
Demerits:
1. Bias
2. Risk of loss
of
confidential
information

11. • Sales people are a good source of
information with regard to
customers future intentions to buy
a product
Sales Force
Opinions
Merits:
1. Easy and
cheaper
2. Collection wisdom
of salesmen's
Demerits:
1. Carry Biases
2. Short run only
3. Salesmen are not
trained

12. • Involves a group of experts within
organization.
• Long run Demand Forecasting.
Expert Opinion
Method
Merits:
1. Time Saving
2. Saving Resources
3. Long term
forecasting
Demerits:
1. High Costs
2. Biased forecast

13. • By using a customer survey a firm can base its
demand forecast on the customers
purchasing plans
Customer
Survey method
1. Complete
Enumeration
Survey:
Door to Door survey
3.Test marketing
survey :
Representative of
Households
2. End use
method :
Producer Goods

14. • Forecasting controlling expenditure on
advertisement and try to find out effect
on demand
• Assuming other things are constant
• Change in packaging
Controlled
Experiment
Method

15. Quantitative Methods
• Trend projection method
• On the basis of data regarding sales of past years and
demand
• Chronological orderly sales Data.
Time Series
Analysis
Secular Trend Seasonal
Variation
Cyclic Variation Irregular Variation

16. • Indicates changes in atmospheric pressures.
• Forecast future trends on the basis of
movements in the index of economic indicators
Barometric
Techniques

17. • To access relationship between two variables
from historical data
• On or more independent variables and one
dependent variable
Regression
Analysis