Developed by Cool Pictures and MultiMedia Presentations Copyright © 2004 by South-Western, a division of Thomson Learning, Inc.

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a division of Thomson Learning. Developed by Cool Pictures and MultiMedia Presentations Copyright © 2004 by South-Western. . All rights reserved. Inc. Organizational Demand Analysis Composed of: • Sales forecasting. • Market potential analysis.

given a particular level and type of marketing effort? Developed by Cool Pictures and MultiMedia Presentations Copyright © 2004 by South-Western. . Inc. All rights reserved. Organizational Demand Perspectives First. what is the highest possible level of market demand that may accrue to all producers in this industry in a particular time period? Second. a division of Thomson Learning. what level of sales can be reasonably expect to be achieved.

Inc. • who provided the information. All rights reserved. • the size of the sample. a division of Thomson Learning. . Before Using Internet Information Assess its quality: • how it was gathered. Developed by Cool Pictures and MultiMedia Presentations Copyright © 2004 by South-Western. • the purpose for which the information was collected.

a division of Thomson Learning. All rights reserved. Internet Limitations  There are no standards for the information. Inc.  The owner has no requirement to provide an evaluation of the site’s accuracy. .  No review process. Developed by Cool Pictures and MultiMedia Presentations Copyright © 2004 by South-Western.  People can publish whatever they want.

4. a division of Thomson Learning. Learn and evaluate the Web site’s author. All rights reserved. Validate the information found on the site with other sites or from hardcopy sources. 5. Developed by Cool Pictures and MultiMedia Presentations Copyright © 2004 by South-Western. Use many Internet sources. 2. 3. Evaluate the accuracy. 6. Evaluate the site’s credibility. . Navigating 1. Determine how often the site is updated. Inc.

a division of Thomson Learning. Inc. All rights reserved. . given a particular level and type of marketing effort? Developed by Cool Pictures and MultiMedia Presentations Copyright © 2004 by South-Western. The Relationship Between Potential and the Forecast The sales forecast answers the question: What level of sales do we expect next year.

. Forecast the statistical series and its relationship to demand for the desired time frame. 2. determine the relationship of the series to the demand for the product whose potential is being estimated. 4. a division of Thomson Learning. 3. Developed by Cool Pictures and MultiMedia Presentations Copyright © 2004 by South-Western. Inc. Select a statistical series that appears to be related to demand for the product. For each target NAICS industry. All rights reserved. Estimates of Absolute Market Potential 1. Determine market potential by relating demand to future values of the statistical series.

a division of Thomson Learning. Data on the series must be available. 2. Developed by Cool Pictures and MultiMedia Presentations Copyright © 2004 by South-Western. All rights reserved. Inc. . Important Criteria in Selecting a Statistical Series 1. Future estimates of the series should be easier to predict than product demand would be.

All rights reserved. Estimating Market Potential Depends On: How well the demand or usage factor represents underlying demand? The quality of the data used. The extent of distortion caused by using averages and gross estimates. Developed by Cool Pictures and MultiMedia Presentations Copyright © 2004 by South-Western. a division of Thomson Learning. . Inc. The ability to estimate future values of the series and usage factors.

Inc. 4. All rights reserved. The unit volume is low. A Complete Census of the Market is Warranted When: 1. a division of Thomson Learning. There is direct sales contact. 2. Developed by Cool Pictures and MultiMedia Presentations Copyright © 2004 by South-Western. 3. Orders have a relatively high value. . The markets are very concentrated.

3. 1. Providing Value From Customer Visits Should be conducted by a cross-functional team and.A discussion guide to structure the visit 4. 2. .A plan for reporting the results.Include well-define objectives.A careful selection of customers. a division of Thomson Learning. Developed by Cool Pictures and MultiMedia Presentations Copyright © 2004 by South-Western. All rights reserved. Inc.

a division of Thomson Learning. 2. . • Effectiveness of qualitative approaches depends on the close relationships between customers and suppliers. experience. Two Primary Approaches to Sales Forecasting 1. Inc. Qualitative techniques • Rely on informed judgment and rating schemes. • Collective expertise. and opinions are used. • Include the executive judgment method. • Primary limitation does not systematically analyze cause-and- effect relationships. All rights reserved. and the Delphi method. Executive Judgment • Enjoys a high level of usage. Developed by Cool Pictures and MultiMedia Presentations Copyright © 2004 by South-Western. • There is no established formula for deriving estimates. the sales force composite method.

• Estimation of future events for which historical data are limited. • Situations that are not suited to quantitative analysis. Well suited to: • New product forecasts. Developed by Cool Pictures and MultiMedia Presentations Copyright © 2004 by South-Western. a division of Thomson Learning. Inc. Delphi Application Usually applied to long-range forecasting. All rights reserved. .

Inc. Summary of Qualitative Forecasting Techniques Typically. Developed by Cool Pictures and MultiMedia Presentations Copyright © 2004 by South-Western. . a division of Thomson Learning. All rights reserved. qualitative estimates will be merged with those developed quantitatively.

uses factors that have affected sales in the past and implements them in a mathematical model. Regression or casual analysis. All rights reserved. a division of Thomson Learning. Inc. Quantitative Forecasting Offers Two Primary Methodoligists Time series techniques use historical data ordered in time to project the trend and growth rate of sales. Developed by Cool Pictures and MultiMedia Presentations Copyright © 2004 by South-Western. .