sales forecasting R

Question 1

what is a sales forecast?

Answer 1

A sales forecast estimates how much your company plans to sell within a certain time period (like quarter or year).

Question 2

what factors affect sales forecast?

Answer 2

1. consumer trends
2. economic variables
3. action of competitors

Question 3

what is extrapolation forecasting?

Answer 3

• forecasting based on the continuation of past trends
• a most common form of forecasting and is the basis of almost all economic forecast
• it will only be correct if the future does continue to be like the past

Question 4

why are sales forecasts important and what do they help plan?

Answer 4

• HR = number to employ
• production/capacity plans
• inventory control
• cash flow forecast
• promotional activity

Question 5

difficulties of sales forecasting

Answer 5

• No historical data/historical data may not reflect future performance
• Dynamic markets are hard to predict
• Seasonality/climate may affect sales
• Fluctuations in demand due to; sales promotion, fashion etc.
• New entrants into markets will impact sales