TERMS USED IN SALES
FORECASTING
It will be appropriate here to discuss the
terms which are commonly used during sales forecasting. These terms are as
under:
(1) Market Potential: Market potential is a
quantitative estimate of combine prospective sales by all the marketing
companies selling the same product in a specified market.
(2) Company Potential:
Company
potential is a part of market potential, which refers maximum capacity of an
individual firm in terms of sales which can be achieved by it, in a given time
period in the total market.
(3) Market Demand and
Company Demand: Market demand and company demand refer to the part of ‘market potential’
and ‘company potential’ which can be achieved under current market situations.
(4) Market Forecast: Market forecast refers to that
portion of market demand which can be achieved combine by all the firms,
selling the same product in a specified market. Thus, it is a prospective total
sales of a specific industry, which can be achieved by all the marketing
companies.
(5) Company Forecast: At the micro level company
forecast is a part of ‘market forecast’, which can be achieved by an individual
firm in terms of sales, in the given conditions and in a specified the frame.
Therefore, it is a part of market-share, which the marketing company wants to
capture in a given period.
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