There is no easy method or formula that could enable individuals or businesses to predict the future with certainty or avoid the difficult process of thinking. Since the future is completely uncertain, there should be careful of dangers.
First, much emphasis on the mathematical or statistical technologies of the forecasting should not be given. Although statistical technologies are necessary to clarify relationships and provide techniques of analysis, they are not the option of decision. Secondly, the danger is that we can go to the opposite extreme and consider the forecast to the so-called experts’ decision. Some of the technologies used are usually demanded are: I
Qualitative methods include survey methods which can be divided into four types
1. Opinion survey method
2. Experts opinion
3. Delphi method
consumer interview method. –
1. Survey method – In short term, the most direct method of forecasting the demand of a particular product or item is the survey method. For the survey, the product’s potential buyers are contacted and information about their future purchase plans are collected. For this, potential buyers are interviewed individually or via a mailing questionnaire to know the future purchase plans of buyers. Either census or sample can be surveyed. Census survey is carried out when the area covered is small, but if that isn’t the case, the sample survey method is adopted. Sales forecast can be prepared through proper analysis of the data collected thus. The survey method also helps to indicate factors that affect buyers’ demand for a particular product.
2. References survey method – in this method, Selsman is asked to give information about the potential demand of the firm’s product in their special areas. Salesman is the person who has direct and constant contact with consumers and has better information about the potential demand of a particular product. Thus; they can provide useful information in this regard. Data collected from salesmans from different areas are analysed by marketing professionals and the demand for the product is final estimate.
Advantages:
1. This method is simple and straight.
2. It includes minimum statistical work. Therefore, there is no need for special technical skills.
3. This method is less costly than customer survey.
4. It is realistic because it is based on Salesman’s personal and direct knowledge.
This method is useful in forecasting the sale of new products.
losses –
1. It’s almost completely subjective. If salesman has personal bias, the forecast would be bias biased.
2. It is only useful for a period of one year. It’s not useful for a long-term production plan.
3. Salesman may not know about changes affecting future demand. However, despite these limits, this method is more useful and suitable because the salesman are more knowledgeable. They can be an important source of information. They are partners. Salesman are either fair or their biases can be corrected.
3. Experts Opinion – This method is most used to forecast the demand of an object. According to this method, experts’ opinion is collected and forecast is prepared based on that opinion. This method uses management opinion and intuition. Thus, the basis of this method is human decision.
Advantages and disadvantages: This technology of demand forecast has many advantages and disadvantages. Its advantages are that it’s less expensive, simple and easy, it takes at least time and the results of this technology are quite reliable. The biggest fault of this method is that it’s based on human decision.
4. Delphi method – A type of survey method is Delphi method.
It’s a refined, statistical method of reaching consensus. Under this method, a panel is selected to suggest solving existing problems. Both internal and external expert panel members can be. The panel members are placed separately from each other and they express their thoughts in anonymous way. It also has a coordinator who acts as an intermediary among panelists. He prepares the questionnaire and sends him to panelists. At the end of each round, he prepares a summary report. Based on the summary report, the panel members will have to suggest. This method has been used in the field of technical forecast. This has proved to be more popular in applying non-economic forecast instead of economic variable.
5. The consumer interview method is personally contacted to know about their plans and priorities in connection with consumption of the product in this method. A list of all potential buyers will be prepared and contacted each buyer and asked how much the product he plans to buy in the future will be asked what ratio he wants to buy.
If consumers are apprehensive of lack, they can enhance their needs. This method is not useful due to irregularity in purchasing plans of consumers, inability to survey and high costs.
Forecasting your choice when facing many options, the consumers’ survey method can be done in three ways. The whole calculation method, sample survey method and final use method of consumers.
The entire calculation method – Under this, all consumers of the product are interviewed in the method on which the forecast is made. Since direct information is collected, this method is free of bias.