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theme 2
B2.2/T7-financial planning
sales forecasting
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amelia tinn
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Cards (13)
what is sales forecasting?
its the business process of predicting how mucg
revenue
the business will generate within a
specific
time frame
what does a
sales forecast
help with?
how much stock to buy and hold
how many staff are needed
most appropriate marketing strategy
if theyll
break even
what is the
purpose
of sales forecasting?
finance
people
marketing
resource management
planning
distribution and delivery
finance purpose
informs
cash flow forecast
predicts
sales volumes
and revenue
asses ability to
break even
inform
profit and loss forecast
people purpose
planning
workforce
plan for
peak times
ensure
supply meets demand
marketing purpose
identify when
promotional activity
is needed
resource management
purpose
to know the required levels of
output
stock management
to know wether
suppliers
can
meet demand
planning
distribution
purpose
ensuring the right products are available at the right locations and times
aligning
inventory levels
with predicted demand
how to forecast sales?
use
historical sales data
to identify future sales. this is called
extrapolation
sales forecast formula
(
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\left(\frac{final\ year\ sales\ -\ first\ year\ sales\ }{number\ of\ years\ }\right)+
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final\ year\ sales\
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4 compenants to
time series data
trends
seasonal fluctuations
cyclical fluctuations
random fluctuations
difficulties
of
sales forecasting
:
to much
data
interpretation
, bias opinion
future doesnt always mirror the
past
economic variables
:
interest rates
infatuation
exchange rates
unemployment
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