Forecasts

Projections of the company's sales in each planning horizon period.

Short term forecast:

• Forecasts are almost always incorrect.

-Planning and inventory control.

Qualitative forecasts

Forecasts

Characteristic

Time horizon

Fields of application

Forecast Methods

• Forecasts are more accurate for groups or families of items.

• The accuracy of forecasts increases when they are made for short periods.

• All forecasts must include an estimation error.

• Forecasts are not a substitute for calculated demand.

Medium term forecast:

Long term forecast

It's when he horizon to forecast goes from 1 year up to 3 months or less

This has a term of 3 Months to 3 years.

Normally its extension is 3 years or more.

It is used to plan sales, production, budget and cash flow, as well as to analyze different operating plans.

They are used to plan the manufacture of new products, capital expenditures, facilities expansion, and for Investigation and development.

This is used to plan purchases, schedule work, determine labor levels, assign work, and decide production levels

it is the art and science of predicting events futures, said prediction can be a subjective or intuitive prediction or a mix of both.

Demand forecasts:

Determine the use of the forecast.

Steps for realization

Select the aspects to be forecast:

Determine the forecast time horizon:

Select forecast models:

Collect the necessary data to prepare the forecast

Make the forecast.

Validate and implement the results

Quantitative forecasts

They incorporate factors such as intuition, emotions, personal experiences and the value system of who takes the decisions

They use a variety of mathematical models that rely on historical data and causal variables

*Cumulative techniques

*Investigation of markets

*Consensus groups

*Historical analogy

*Delphi method.

*Intuitive approach

*Simple moving average.

*Weighted moving average.

*Exponential Smoothing

*Trend Projections

*Regression Analysis

-Production.

-Finance.

It is used when determining demand.

They serve to plan and coordinate the work.

It is essential in the preparation of budgets to determine what would be the future expenses that a company should incur