what is a sales forecast used to inform businesses for?
is used to inform business decisions and ensure they have enough cash available
business decisions: finance
-make sure salaries are paid
-set budget for other departments
business decisions: marketing
-advertisements=decide what,how,when to advertise
business decisions: operations
-decide on the level of stock for product needed
-negotiating with the suppliers and ensuring right amount is available
business decisions: human resources
-decide numbers of staff
factors affecting sales forecast
consumer trends-demand in markets changing as consumer tastes and buying habits change
economic variables-interest rates ,inflation and exchange rates
actions of competitors- eg a competitor launching a new product, promotional campaign or price reduction could reduce sales of your business
difficulties of sales forecasting
dynamic market -rapid changes in the market
past performance is no guarantee of future performance - just because sales have been increasing in the past, does not mean that sales with increase in the future