A Quantitative Method of Sales Forecasting

This work introduces a new sales forecasting method that attempts to model consumers demand for a product as behavior -- the effect of the impact of (independent) factor(s) associated with a product's characteristics.

The method serves two purposes:

(1) Explanation: a statistical analytic method for distinguishing real effects on sales in order to:

- identify and evaluate influencing factors on sales (which factors are product related factors have most impact on customers can help explain why demands fluctuates?), and/or

- discover the importance of certain endogeneous factors (of all the uses of funds, which has the most effect on consumer demand ?)


(2) Forecasting: a robust tool for developing forecasting models. It can be used alone as a measuring instrument for predicting effects on sales, by evaluating the profitability of a product for a predetermined length of time through the investigation of the impact of factors have on a business's operations (sales) and the evaluation of the trends in sales over the years. Or, it can be used in combination with other predictive and descriptive models that attempt to evaluate an overall business's performance (the forecasting procedure requires some understanding of the model process).

The method can be used in decisions that involve financing, operations and corporate investments.