Demand forecasting is a process of estimating future consumer demand for a particular product or service.
It involves analyzing historical data, market trends, and other relevant factors to predict the likely demand in the future. The purpose of demand forecasting is to help businesses make informed decisions about production levels, inventory management, pricing strategies, and resource allocation.
By accurately anticipating demand, companies can optimize their supply chain, reduce costs, and improve customer satisfaction. Various techniques, such as statistical models, time series analysis, and market research, are used to forecast demand. However, it is important to note that demand forecasting is not an exact science and relies on assumptions and data accuracy. Regular monitoring and adjustments are crucial to refine forecasts and adapt to changing market conditions.