2.2.1 Sales Forecasting

Question 1

What is sales forecasting

Answer 1

Estimating future sales of a business

Question 2

Positives to completing a sales forecast

Answer 2

Enables business to make decisions about:

• Productive capacity
• How much stock is needed
• Staffing levels
• Promotional activity

Question 3

Negatives to completing a sales forecast

Answer 3

• Does not take into account external factors that may occur (COVID-19)
• They reduce risk but cannot guarantee success.
• If a business is new or are going into a new market there is a higher chance of inaccurate forecasts to occur.

Question 4

Factors affecting sales forecasts

Answer 4

• Consumer trends (changing tastes and habits)
• Economic variables (comprises of consumers, businesses and government)
• Actions of competitors (changing marketing strategy, 4P’s)