Sales forecasting is very essential in sales and in this article you will find various techniques of sales forecasting.
Sales forecasting is essential in business, and sales forecasting is the major factor of success in business. There are many advantages of sales forecasting, and more accurate sales forecasting means more scope of success in your business. Forecasting helps in reducing inventory and to schedule customers' orders. Accurate sales forecasting is very helpful in planning of plant procurement and for cutting the cost. Sales forecasting also helps in prediction of revenue, hence it is necessary for you to understand accurately the concept of sales forecasting. There are many factors that affect sales forecasting and you must understand these factors before doing sales forecasting.
1. First, you have to understand all previous year's sales figures because these previous year's sales figures give you the base, on which you will have to create a building of sales forecasting.
2. Every business has its own sales pattern and you have to understand this pattern of sales before doing sales forecasting for the coming year.
3. Seasonal fluctuations play a significant role in sales forecasting and you forecast the sales in accordance with these seasonal sales fluctuations.
4. If you are going to launch a new product in coming year or you had launched a new product in previous year, then this launching of new product can affect the sales forecasting, hence you should consider this factor of launching of new product before doing sales forecasting.
5. You have to consider other plans of your company before doing sales forecasting for example, if you are going to change or going into new premises, then this decision may affect the sales.
6. Your sales forecasting should be aligned with your future marketing plans. For example, if you are going to give special sales promotion in upcoming year, then this special promotion surely affects the sales, hence you have to consider this factor very seriously before doing sales forecasting.
7. You have to consider competitiveness of the current market because planning of your competitors will also affect your sales.
8. Last, but not least, you have to consider situation of current economy whether recession is coming or not. You have to consider both local and global economic situation in order to better sales forecasting.
Although your sales forecasting won't be always accurate, but it is very important to do sales forecasting because it helps in decision making in business and many decisions like new product launching are done with help of sales forecasting.