Question

Why is forecasting important to businesses. What type of business forecasting do you think would best suit your line of work? Or describe a forecasting need for a company and discuss how it helps the business. Explain your answer.

Answer 1

The main objective of business forecasting in organizations is to be accurate as possible, so that planning of resources can be done in a very efficient economical way and thus, propagate optimum utilization of resources. Business forecasting helps organizations in establishment of relationship among many variables, which go into manufacturing of the product.

Our company is into sales of cardboards, thus "Sales Forecast" type of business forecasting is undertaken with precaution and due care thus to ensure that whatever planning department has decided is carried out for the sales promotion. The sales forecast that is required to set the stage for internal planning, capital outlays, business expenses. Good forecasting is utmost important because the time window for sale is narrow. If an organisation has overstocked- or under stocked, it has little chance to recover. Moreover, all types of policies are made with an objective of maximising profits in the company with an obtainable from expected sales.