Sales forecast | Theme 2 Flashcards
Theme 2
1
Q
Why is sales forecasting important?
A
To know how high your demand is and to work out how much stock you need
2
Q
What is a time series analysis?
A
Predicting data from past sales to get an indicator of what will happen in the future
3
Q
Four benefits of sales forecasting
A
- Provides an input for the cashflow forecast
- It allows the business to plan orders of supplies and resources
- Enables to plan for staffing levels
- Ensures it has the machines and premises to meet all orders
4
Q
Three factors affecting sales forecast
A
- Consumer trends
- Economic variables
- Action of competitors
5
Q
What is inflation?
A
The general increase in the price level. Money losing its value
6
Q
What happens when unemplyoment rises?
A
Spending in the economy reduces and sales forecasts are reduced.
7
Q
Action of competitors
A
Lowest unit cost = significicant competitive advantage
8
Q
Difficulty in sales forecasting
A
Difficult to predict consumer taste and preferences
