3.3.1 quantative sales forecasting

what is quantative sales forecasi

Quantitative sales forecasting is the process of predicting future sales using numerical data (usually past sales figures) and statistical techniques to identify trends, patterns, and seasonal variations.

what can a business do with quantative sales forecasting / time series analysis

• organise production

• staff needed for level of production

• managment of product

• marketing to promote product

Moving average

moving average example

What are the strengths of using moving averages in sales forecasting?

• Smooths out short‑term fluctuations

• Reveals the underlying trend clearly

• Simple to calculate and interpret

• Useful for short‑term forecasting

• Helps identify seasonal patterns

• Reduces impact of random variations

What are the limitations of using moving averages in sales forecasting?

• Assumes past trends will continue

• Less accurate in volatile or changing markets

• Ignores qualitative factors (e.g., competitor actions)

• Longer averages make trends less responsive

• Cannot predict turning points in demand

• Requires consistent, reliable historical data