Methods of

Demand
Forecasting
-Yogit Nandwani
 What is Demand Forecasting

Demand forecasting is the prediction of demand for a product

or service in the future which is based on past behavior
patterns and the continuing trends in the present.
Hence, it is not simply guessing the future demand but is
estimating the demand scientifically and objectively.
 METHODS OF DEMAND FORECASTING

BROADLY, these methods are classified in two categories i.e

● QUALITATIVE (Opinion polling methods)
● QUANTITATIVE (Statistical )
 QUALITATIVE (Opinion polling methods)

● Opinions of buyers and experts are gathered

● Suitable for short run
● Can be used for New products

Opinion Pollings can be done in following ways :-

- Consumer Survey Methods
- Sales Force Opinions Methods
- Delphi Method
 QUANTITATIVE (Statistical Methods)

● It is applied on existing data in order to generate the predicted demand.

● Suitable for long run

It can be done in following ways :-

- Trend Projection Method
- Barometric Method
- Regression Method
- Econometric Method
 BENEFITS

● Enables organisation to take various business decisions

● Efficient planning of production process
● Purchasing Raw Material
● Deciding price effectively
● Managing funds well
● Better staff organisation
● Avoid losses
● Long term Growth