Meaning And Definition Of Demand Forecasting

The demand forecasting serves as the reference point for all marketing control efforts.

Meaning and definition of demand forecasting. What is demand forecasting. Demand means outside requirements of a product or service in general forecasting means making an estimation in the present for a future occurring event. Demand forecasting is a combination of two words.

It may be based on estimates of demand potential of the entire industry. Demand forecasting is a field of predictive analytics which tries to understand and predict customer demand to optimize supply decisions by corporate supply chain and business management. It is not based on mere guessing or prediction but is backed up by evidence and past trends.

Here we are going to discuss demand forecasting and its usefulness. Demand forecasting refers to the process of predicting the future demand for the firm s product. In other words demand forecasting is comprised of a series of steps that involves the anticipation of demand for a product in future under both controllable and non controllable factors.

Demand forecasting involves quantitative methods such as the use of data and especially historical sales data as well as statistical techniques from test markets.