The use of end results generated from forecasting is done to calibrate the business processes and set targets for the sales teams. It also encompasses the desired features and suitability for its intended use. Demand Forecasting is the scientific process of estimating the future demand for products in terms of quality, quantity, and driving factors. People always think about what do you mean by demand forecasting. Why Businesses Forecast Demand: More Crucial Than Ever Before These areas are now one of the most vital elements of industrial engineering and also form a major part of operations research. Due to this reason, the need for a scientific approach to solve this problem was required.
In the absence of sales planning and forecasting, the entire business strategy is reduced to mere guesswork and personal opinions from decision-makers. If you know where demand is heading and what are the evolving circumstances, it is only then that you can act sensibly. So, if you are willing to keep your firm financially healthy and ensure sustainability in the longer horizon, you have to count your chickens way before they hatch. It holds existential relevance to the profitability and survival of the firms. Thus, accurately estimating the shifts in customer sentiments and other factors contributing to the industry is a basic necessity. Or even worse- scrapping them due to the absence of demand. The biggest nightmare of any business today is to sit on a pile of production-ready resources and see them idle. I am a big fan of Stoicism, but I think that it’s high time that we move on from this Greek principle. Don’t Count Your Chickens Before They Hatch – Aesop