Scribd
Upload
59 views1 page

Question: What Is Demand Forecasting and What Are The Objectives of Demand Forecasting. Demand Forecasting

Demand forecasting involves estimating future demand for a product under competitive market forces. It has two types: long term and short term forecasting. The objectives of demand forecasting are to help companies establish production, pricing, inventory, and sales policies while avoiding over or under production through anticipating future demand.

Uploaded by

Sopnobaz Fakir
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
59 views1 page

Question: What Is Demand Forecasting and What Are The Objectives of Demand Forecasting. Demand Forecasting

Demand forecasting involves estimating future demand for a product under competitive market forces. It has two types: long term and short term forecasting. The objectives of demand forecasting are to help companies establish production, pricing, inventory, and sales policies while avoiding over or under production through anticipating future demand.

Uploaded by

Sopnobaz Fakir
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 1

Question: What is demand forecasting and what are the objectives of demand

forecasting.
Demand Forecasting:
Demand forecasting involves ascertaining the expected level of demand during a specific
period of time. So, it can be stated that demand forecasting is the process of finding out
the likely demand for a product at various prices during a specific future period. Simply,
it can be stated that demand forecasting is the estimation of future demand for a product,
such an estimation of the future situation is known as forecasting.
Demand forecasting is a systematic process that involves anticipating the demand for the
product and services of an organization in future under a set of uncontrollable and
competitive forces.
An organization faces several internal and external risks, such as high competition,
failure of technology, labor unrest, inflation, recession, and change in government laws.
Therefore, most of the business decisions of an organization are made under the
conditions of risk and uncertainty. An organization can lessen the adverse effects of risks
by determining the demand or sales prospects for its products and services in future.
Types of forecasting:
1. Long term forecasting and
2. Short term forecasting.
Objectives of Demand Forecasting:
1. To formulate a sustainable production policy;
2. To formulate an appropriate pricing policy;
3. To formulate adequate working capital;
4. To arrange short term financial requirements;
5. To arrange sales promotional strategy;
6. To set sales target;
7. To control the inventory;
8. To reduce elements of cost;
9. To avoid over production;
10. To avoid under production;
11. To avoid depreciation;
12. To avoid inflation;
13. To provide incentives to the employees;
14. To help the management; and
15. To expedite the production process and efficiency of production.

You might also like