It consists of Demand Forecasting content

1. What is Demand?
Demand for a product refers to
Desire of an individual for a product
Ability to pay for the product
Willingness to pay for the product.
If there is ability and willingness but no desire then it is nor
a demand. Similarly, without willingness if there is desire
and ability, then also it is not a demand.
What is Forecasting?
A forecasting is a prediction or estimation of future
situation under given conditions.

2. Various types of demand forecasting are as follows
Passive forecasts
Active forecasts
Micro forecasting
Long term Forecasting
Short term Forecasting
Importance of Demand Forecasting:
For planning and Production analysis
Sales Forecasting
Control of Business
Inventory Control
Long term Investment Programs
Maintain Stability
Helpful for Planners and Policy Makers

3. Identify and clearly state the objectives of
forecasting
The objective may be short-term or long-term
Select Appropriate method of forecasting
Identify the variables affecting the demand for the
product and express them in appropriate forms
Gather all relevant date o represent the variable
It may be made either in terms of physical units or
in terms of rupees of sales volume

5. Survey Method:
Census method
Sample Method

7. Collective Opinion method:

8. Delphi Techniques:

9. Based on Past Trends:
Fitting a Trend Linear
Least Square Method
Time Series Analysis
Moving Average Method
Least Square Method
S= a. T + b
S= Sales
a, b = Past Data Calculation
T = The year for which forecast is required

10. Based on Past Trends:
Fitting a Trend Linear
Least Square Method
Time Series Analysis
Moving Average Method
Time Series Analysis
S = a + b + c + d
Where
a= Trend
b= Season
c= Cycle
a, b, c, d= Constant calculated
from past data.
Moving Average Method
This method is based on past sales
data and it is used for short term
forecasting and it is based on
assumption that the future is the
average of past performance