Forecasting III

FORECASTING III

Forecasting is one of the more difficult parts of the sim. There are several models you can use to forecast sales. Remember, a model is never perfect, though over a few rounds you can tweak your particular model to be quite close. Mine never underproduced, and never overproduced by more than around 80 in any single round.

There are so many variables to consider when forecasting, however, in the early stages of the game there is not much to go on since everyone starts with the exact same numbers. Starting around round 3, you should have a good idea about where the competition is going, which will help your forecasting.

The forecasting numbers that you enter in the Marketing page will drive the proformas, so try to get a realistic worst case idea for the Marketing page. (See my other Best/Worst Forecasting page about this topic).

Essential to good forecasting is competitive analysis. When forecasting for your best case sales for the Production page, here are some things to keep in mind when doing a competitive analysis for your forecasting:

• December customer survey scores
• Check top 2 customer criteria for your product vs. your competitors products
• Perceptual Map - where are your products vs the competition's products
• Actual vs. potential market share (this can be misleading because the Courier does not show monthly sales)
• Always examine the production sheet on page 4 of the Courier. This is one of the more important pages in the Courier with a lot of information on the competition. ALWAYS LOOK AT THE COMPETITION'S NUMBERS on page 4 when you are forecasting.