E 2.2.1 sales forecasting*

Question 1

sales forecast definition

Answer 1

an estimate for the businesses future sales

Question 2

how sales forecasting can help businesses

Answer 2

> can tell them weather to order more or less stock
can tell them how much they should spend on advertisement
tells them what to do to meet the demand e.g employ more staff
allows them to assume how much money they will need for costs and how much they make

Question 3

factors affecting sales forecast

Answer 3

> consumer trends e.g being healthy…
economic variables e.g. if recession, people have less disposable income
actions of competitors e.g. loose customers to competitors for cheaper prices, better quality more convenience…

Question 4

problems businesses face when forecasting sales for the future

Answer 4

> may be factors that they cant control that could impact the business e.g. COVID
new business would not have any previous data to go off- don’t know what to expect.