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Step i. Gathering Information
- Target Specification Product
Instead of forecasting on larger brand name of your company or overall product line, identify the product you want to track. Doing this makes it easier to organize past data and forecast demand. For example if you have an existing line of winter garments, focus specifications on gloves instead of entire catalogue.
Step ii. Look at previous months
Look at both recent months and annual vacancies. This will help you determine annual and
seasonal fluctuations. When looking at the past month, analyze the driving pattern behind the demand. Look at any price adjustment, successful marketing companies or a rise in new
customers. If you choose to replicate these factors consider that in your forecast.
Step iii. Determine your lead time
Lead time is the time between the initiation and completion of a product. Knowing this will help you to determine how fast you can make your product and meet demand.
Step iv. Calculate the raw materials and components
Product time will help you make a more accurate forecast demand. Focusing on a particular item help to predict how many material you will need and the production time to make your product. When you have your production quantities estimated, look at the components demand of each item.
Step v. Look at your market planning
Any market campaign or sales promotion will increase the demand of your product. Look at the
past data and see what was successful in the past. See if there were special discounts or holidays sales that increased demand for your products. You want to take all of this into consideration when forecasting demand, particularly if you plan to repeat similar sales strategies.
Step vi. Review Key Indicators
Find out what is behind the fluctuations in your customers demand. Key indicators include
environmental factors. Demographic include age, gender, location and any other set of
identifying characteristics. Identifying of the demand of key demographics helps to narrow the data pool for the forecast. Environmental factors affect demand as well. For example a mud winter will likely cause a lower energy demand.
NatalieR answered the question on June 10, 2022 at 13:33
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