Demand forecasting is the process of estimating and projecting future demand levels for a given product or service. It is based on the analysis of historical data, market trends and seasonal factors. But also consumer preferences and other relevant variables.
Demand forecasting is essential for inventory planning and management. It is also essential for production, marketing strategies and overall corporate decision-making.
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.
