BUSINESS ADMINISTRATION
MARKETING MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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How are sales forecasts calculated?
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A firm estimates the total market and then estimates their share of that market to determine a sales forecast of a particular product
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Includes distribution strategy, effective sales force, increased promotion, different prices
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Include a budget for sales/revenues, identifying new marketing strategies, setting a sales quotas for sales staff, etc
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All of the above
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Explanation:
Detailed explanation-1: -The simplest formula to use is: sales forecast = the previous period’s sales + estimated growth (or shrinkage) in sales for the next period.
Detailed explanation-2: -Sales forecasting allows companies to efficiently allocate resources for future growth and manage its cash flow. Sales forecasting also helps businesses to estimate their costs and revenue accurately based on which they are able to predict their short-term and long-term performance.
Detailed explanation-3: -Mean Absolute Percentage Error (MAPE) is a common method for calculating sales forecast accuracy. It’s calculated by taking the difference between your forecast and the actual value, and then dividing that difference by the actual value.
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