N5 Sales Management
Examples of indicators are: 1. An increase in manufacturing activity means an increasing demand for consumer goods. An increase in manufacturing activity can also mean more employment.
2. Increase/decrease in unemployment rate. 3. Increase/decrease in food inflation rate.
6. Factors influencing the selection of forecasting methods Time available:
Some methods like the Delphi technique takes longer than others, for example Jury of Executive Opinion, and a lack of time can make some methods of no use.
Availability of data: The time series analysis requires a historical database. If adequate data does not exist, as in the case of a new product, this method cannot be used. Rather use the Delphi or Jury of Executive Opinion.
Personnel/staff: Accuracy:
The expertise of personnel is another critical consideration. To develop meaningful forecasts, the methods and data must be clearly understood by personnel members.
The degree of accuracy desired affects the method selected. What are the risks involved if the forecasting proves inaccurate?
Product or service: Different product-lines/items in a business's product range should be forecasted separately since different factors may affect their sales. For example, a product in the maturity stage of the life-cycle will have extensive historical sales data to support a short-term forecast. A product that was just launched will not have such a track record.
Activity 2 1. Toyota South Africa is currently busy with sales forecasts for their next financial year. 1.1. Explain how they can use the following methods of forecasting: i. Delphi technique ii. Sales force composite
1.2. Give two advantages for each of the following: i. Delphi technique ii. Sales force composite
2. Give two reason why the Delphi technique is used rather than the Jury of Executive Opinion method.
3. Name the advantages of the Users’ Expectations approach as a forecasting method. 4. Clearly distinguish between market potential and sales potential of a product. Use the cell phone industry in South Africa as an example to motivate your answer.
5. Discuss the Jury of Executive Opinion as a method to forecast Toyota’s sales. 6. Discuss the Sales Force Composite method to forecast sales figures. Also refer in the answer tothe advantages and disadvantages of this method.
7. List another four methods, except the Delphi technique, that the managers of Adidas can useto forecast the sales of their products in South Africa.
8. Name and explain five factors influencing the selection of a forecasting method for Builder’s Warehouse.
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