Demand forecasting predicts future demand for goods or services based on past events and current trends.
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Demand forecasting, as defined by Cundiff and Still, estimates demand tied to marketing plans and uncontrollable forces.
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Accurate demand forecasting is fundamental for producing the right quantities, planning investments and aiding government policies
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1. It also guides decisions about advertising and sales campaigns. 2. It helps in planning for the right kind of skilled workers. 3. It’s essential for planning how much to produce.
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(1) To Produce the Required Quantity (2) To Assess Probable Demand (3) Investment and Employment (4) Team Work (5) Help to the Government
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Short-term Forecasting (Purpose): – Shapes advertising and promotion strategies. – Forecasts short-term financial needs. – Assists in controlling costs related to raw materials and inventory.
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-develop a strategy to produce goods that align with changing societal needs. – Anticipates future manpower needs, especially as production techniques evolve. – Assesses long-term financial requirements, crucial for raising funds.
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(1) Identification of Objective (2) Determining the Nature of Goods (3) Selection of Proper Method (4) Interpretation of Results
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1. Period of Forecast 2. Levels of Forecasting 3. General Purpose or Specific Purpose Forecasts 4. Type of Commodity for Forecasting 5. Inclusion of Miscellaneous Factors
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1. Statistical Methods. 2. Experts’ Opinion Method 3. Opinion Polling Methods 4. Methods of Demand Forecasting
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1. Timeliness 2. Availability 3. Economy 4. Simplicity 5. Accuracy
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