A demand forecast is the prediction of what will happen to your company's existing product sales.

It would be best to determine the demand forecast using a multi-functional approach. The inputs from sales and marketing, finance, and production should be considered. The final demand forecast is the consensus of all participating managers. Determination of the demand forecasts is done through the following steps: Determine the use of the forecast Select the items to be forecast Determine the time horizon of the forecast Select the forecasting model(s) Gather the data Make the forecast Validate and implement results

Qualitative Methods These methods rely on experts who try to quantify the level of demand from the available qualitative data. The two most widely followed methods are:

Jury of execution opinion method: Opinions of a group of experts is called for and these are then combined to arrive at the estimated demand. Delphi Method: In this method a group of experts are sent questionnaires through mail. The responses received are summarised without disclosing the identities. Further mails are sent for clarification in cases of extreme views. The process is repeated till the group reaches to a reasonable agreement.

average

a moving average, also called rolling average, rolling mean or running average, is a type of finite impulse response filter used to analyze a set of datum points by creating a series of averages of different subsets of the full data set.

Given a series of numbers and a fixed subset size, the first element of the moving average is obtained by taking the average of the initial fixed subset of the number series. Then the subset is modified by "shifting forward", that is excluding the first number of the series and including the next number following the original subset in the series. This creates a new subset of numbers, which is averaged. This process is repeated over the entire data series. The plot line connecting all the (fixed) averages is the moving average. A moving average is a set of numbers, each of which is the average of the corresponding subset of a larger set of datum points. A moving average may also use unequal weights for each datum value in the subset to emphasize particular values in the subset. A moving average is commonly used with time series data to smooth out short-term fluctuations and highlight longer-term trends or cycles. The threshold between short-term and long-term depends on the application, and the parameters of the moving average will be set accordingly. For example, it is often used in technical analysis of financial data, like stock prices, returns or trading volumes. It is also used in economics to examine gross domestic product, employment or other macroeconomic time series. Mathematically, a moving average is a type of convolution and so it can be viewed as an example of a low-pass filter used insignal processing. When used with non-time series data, a moving average filters higher frequency components without any specific connection to time, although typically some kind of ordering is implied. Viewed simplistically it can be regarded as smoothing the data.

TIME SERIES The most popular method of analysis of time series is to project the trend of time series. A trend line can be fitted through a serious means of statistical techniques

TREND ANALYSIs- it is used to make future prediction. independent variable are used for prediction unknown of dependent variable

REGRESSION MODEL It is a statistical techniques for quantifying the relationship between variable. In simple regression analysis there is one dependent variable ( eg sales) to be forecast and one independent variable MOVING AVERAGE- are average that r updated as new information is received. with the moving average a manager simply employs the most recent observation, drops the oldest observation, in the earlier calculation and calculates is used as the forecast of next period SIGNIFICANCE TEST 1 T TEST The formula for the t test is a ratio. The top part of ratio is just the difference between two means of averages. The bottom part is a measure of variability or dispersion of the scores The difference between the mean is the signal that, in case we think our program or treatment introduced into data. the bottom part of the formula is a measure of variability that is essentially noise that may make it harder to see the group difference 2CHI SQUARE TEST - Pearsons chi squared is used to assess two types of comparison tests of goodness and test of independence A test of goodness of fit establishes whether or not an observed frequency distribution differ from a theoretical distribution A test of independence assesses whether paired observation on two variables, expressed in a contingency table are independent of each other- for example, whether people from different regions differ in the frequency with which they report that they support a political candidate