2 min read

Future sales prediction

A sales forecast is an estimate of the number of goods and services you can realistically sell over the forecast period, the cost of the goods and services, and the estimated profit.
Future sales prediction

Data Science Usecase (Part 3)

Sales Forecasting is the process of estimating what your business’s sales are going to be in the future. A sales forecast period can be monthly, quarterly, half-annually, or annually.

Sale forecasting is an integral part of business management. Without a solid idea of what your future sales are going to be, you can’t manage your inventory or your cash flow or plan for growth. The purpose of sales forecasting is to provide information that you can use to make intelligent business decisions.

For example, if your forecast indicates a 30% increase in sales of products or services, you may wish to begin searching for larger business premises and hire additional staff to meet the demand. Conversely, a forecast of shortfalls in sales can allow you to mitigate the effect by taking advance measures such as reducing expenses or reorienting your marketing efforts.

Sales Forecasting for New Businesses

Sales forecasting for a new business is more problematical as there is no baseline of past sales. The process of preparing a sales forecast for a new business involves researching your target market, your trading area and your competition and analyzing your research to guesstimate your future sales. See Three Methods of Sales Forecasting and Sales Forecasting for Your Business Plan for further explanation.

Sample 6 Month Sales Forecast

JanFebMarAprMayJunTotal
#Units Sold
Widget 110101515151580
Widget 2202025252525120
Unit Price $
Widget 1$50$50$50$50$50$50
Widget 2$35$35$35$35$35$35
Sales
Widget 1$500$500$750$750$750$750$4000
Widget 2$700$700$875$875$875$875$4900
Total Sales$1200$1200$1625$1625$1625$1625$8900
Unit Cost
Widget 1$25$25$25$25$25$25
Widget 2$30$30$30$30$30$30
Total Cost
Widget 1$250$250$375$375$375$375$2000
Widget 2$600$600$750$750$750$750$4200
Profit
Widget 1$250$250$375$375$375$375$2000
Widget 2$100$100$125$125$125$125$700
Total Profit$350$350$500$500$500$500$2700

To be continued...

Source link: https://www.thebalancesmb.com/sales-forecasting-2948317

Probyto - Your AI Success Partner
Probyto - Your AI Success Partner
https://probyto.com/demo-registration/

#probyto #probytoai #datascience #machinelearning #python #artificialintelligence #ai #dataanalytics #data #bigdata #deeplearning #programming #datascientist #technology #coding #datavisualization #computerscience #pythonprogramming #analytics #tech #dataanalysis #iot #programmer #statistics #developer #ml #business #innovation #coder #dataanalyst

Subscribe and follow us for latest news in Data Science and Machine learning and stay updated!
Facebook: https://facebook.com/probyto
Twitter: https://twitter.com/probyto
LinkedIn: https://linkedin.com/company/probyto
Instagram: https://instagram.com/probyto