Unit 30 - Sales Forecast Flashcards
Def: consumer income
The amount of income remaining after taxes and expenses have been deducted from wages
Def: consumer trends
The habits are behaviours of consumers that determine the goods or services they buy
Def: economic growth
The rise in output of an economy as measured by the growth in gross domestic product GDP usually as a percentage
Def: economic variable
Measures within the economy which have effect on business and consumers examples unemployment inflation
Def: extrapolation
Forecasting future trends based on past data
Def: forecasting
A business process assessing the probable outcome using assumptions about the future
Def: sales forecast
Projection of future sales revenue often based on previous sales data
Def: time series data
A method that allows a business to predict future levels from past figures
Oposite of zero based budgeting
Is historical budgeting
Components identified in a time series data
The trend
Seasonal fluctuations
Cyclical fluctuations
Random fluctuations
Benefits of sales forecasting
Can’t give an idea of cash inflow
Allows to plan order of supplies and components
Ensure business has correct staffing levels
Ensure they have the capacity to meet the project orders
Factors that affect sales forecasting
1 Consumer trends
Seasonal variation
Fashion
Long term trends
2 Economic variables
Economic growth
Interest rates
Inflation
Unemployment
Exchange rates
3 Action of competitors
