1. Sales Forecasts are used for: New product decisions Product scheduling Financial planning Inventory planning and procurement Distribution Human resource planning

2. Time Frame of Sales Forecasts Short-range forecasts – Last fewer than three months Intermediate forecasts – Last three months to two years Long-range forecasts – Last more than two years

3. Factors which affect how far ahead a business should predict sales Continual decisions in planning, scheduling, inventory and staffing in production, procurement and logistics activities are short range Budgetary planning, cost control, marketing new products, sales force compensation plans, facility planning, capacity planning and process selection and distribution planning are intermediate Whether to enter new markets, develop new products or services, expand or create new facilities, or arrange long-term procurement contracts are long-range

4. Factors which affect how far ahead a business should predict sales Continual decisions in planning, scheduling, inventory and staffing in production, procurement and logistics activities are short range Budgetary planning, cost control, marketing new products, sales force compensation plans, facility planning, capacity planning and process selection and distribution planning are intermediate Whether to enter new markets, develop new products or services, expand or create new facilities, or arrange long-term procurement contracts are long-range

5. Qualitative and Quantitative Qualitative How well Quantitative

6. Qualitative vs. Quantitative Forecasting Methods Qualitative Relies on subjective data that reports opinions rather than historical data Quantitative Uses facts or statistical computations such as trend extensions based on past data, computer simulations, and economic models.

7. Factors affecting Sales Forecasts Internal Sales Fluctuations – Who are our customers? – Number of customers? – Diversity of customers? New Products – Very new? – Not similar to other items or services? External Market Conditions – New Technology – Industry Growth – Trends – Laws/Regulations