Estimating Demand and Forecasting Sales and Sales Force Simulation Summary - Essay Example

Sales forecasting is also very valuable when a company is embarking in new ventures such as expansion plans. Sales forecasting is not exact science and many business experts consider it an art. Forecasting methods include both quantitative and qualitative analysis. Jury of executive opinion is a popular forecasting technique. The technique is based on the Delphi method (Estimating Demand and Forecasting Sales and Sales Force Simulation). This technique uses the knowledge of experts in a systematic manner.

The experts create a panel in which open discussion and questionnaires are used to find a solution. Biased and tension among the group of experts opinions is eliminated by creating confidentiality through anonymity. In a study realized by Mentzer & Kahn on forecasting techniques they found that after been exposed to long period of times managers preferred the jury of executive opinion forecasting technique over other methods. As a general rule a company should apply the same forecasting technique when realizing an analysis with different data.

The advantange is that the anaysis has a strong comparison base due to consistancy across the board. In the case of a sales forecast for entering new markets the general rule does not apply. When a company is the process of gathering data of different markets a lot different paraments enter into the equation. It might not be possible to gather the same type of data from the different markets. Also different behavioral tendencies of a market make alternative sales forecasting methods more suituble for particual situations.

In the sales management simulation studied the company analyzing two different potential markets to introduce a beer product found that the two countries had different cultures and consumer tendencies. Different sales forecasting methods were utilized to create a sales forecast for each country. When a company determines its sales forecasting it must also determine the