1. Sale Forecasting In Organization
Professor Guider:
Dr.Masoud.Zade Attar
Presenter:
Zahra Daneshpour
2. After market segmentation process and target market selection,
appropriate sale forecasting leads to strategic an systematic
programming.
3. What is the sale forecasting?
• Is the process of a company predicting what its future sales will be.
• The program that your sales force provides is the source of
information that allows you to manage virtually all aspects of your
business.
Forecasting is one of the IMPORTANT aspects of administration.
4. Why do we need to forecast sales?
Good
Forecasting
Increase
Knowledge
Improve
Manage
products
informed
decisions
Develop
6. :Sales Planning
• Planning future activities,
• Providing each of them with a business plan,
• Identify the customers to meet their objectives.
Demand Forecasting:
• Best positioned to gather information about anticipated
demand.
• Good estimate of the demand for the products you sell.
7. Higher OTIF Delivery:
• Achieve a higher rate of On Time In Full (or OTIF,
delivery)
• Guarantees that sufficient product will be
manufactured.
Inventory Controls:
• Better prepared your company will be to manage its
inventory.
• Avoiding both overstock and stock-out situations.
8. Supply Chain Management:
• Predict demand and manage production more efficiently.
• Better control over your supply chain.(This affords you
the opportunities to manage resources and take full
advantage of just-it-time ordering)
Financial Planning:
• Gives you the information you need to predict
revenue and profit.
• Also ability to explore possibilities to increase both
revenue and net income.
9. Internal Controls:
• Better control of your internal operations.
• You can make decisions about hiring marketing and
expansion.
Continuous Improvement:
Continuous
Improvement
Revising the
Process
Improve the
Accuracy
Can Improve ALL
Aspects
10. Price Stability:
• The good levels of inventories that you maintain will
prevent the need for panic sales to rid your business
of excess merchandise.
Marketing:
• Gives marketing an advanced look at future sales and
offers the opportunity to schedule promotions if it
appears sales will be weak.
11. Types of Forecast by Time Horizon
• Up to 1 year, usually less than 3 months
• Job scheduling, worker assignments.
Short-range
forecast
• 3 months to 3 years
• Sales and production planning, budgeting
Medium-
range forecast
• 3+ years
• New product planning, facility location
Long-range
forecast
12. Seven Steps In Forecasting
Determine
the use of
the
forecast
Select the
items to
be forecast
Determine
the time
horizon of
the
forecast
Select the
forecasting
model(s)
Gather the
data
Make the
forecast
Validate
and
implement
results
13. Importance of Sales Forecasting:
Sales
forecasting
Production
Purchasing
Human
Resources
Finance
Research and
Development
Marketing
14. How to Forecast Sales:
Forecasting Methods and
Formulas
Estimate market
size
Identify market
needs
17. First sample:
The number of customer
for specific products
The number of product
purchased by a customer
averagely
Average price
18. Second sample:
• A method of calculating total market
demand for a product in which a base
number.
• The total population of a country, is multiplied by several percentages,
such as the number in the population above and below certain ages…
Example:
19. :Forecasting Errors
• Possible reasons for errors in forecasting
1. Flaws in data used in forecasting process,
2. Insufficient data,
3. Unpredictable economic and socio-political
environment,
4. Non-realistic and accurate assumptions,
5. Technical and technological changes,
6. Shifts in economic structure,
7. Administrative errors.
20. One of The important Consequences
of Wrong Predictions:
Overproduction
Low production
