uncertanities in demand forecasting

UNCERTANITIES IN DEMAND FORECASTING

Data about past and present markets.

Lack of standardization

Few observations

Influence of abnormal factors

Methods of forecasting

Inability to handle unquantifiable factors

Unrealistic assumptions

Excessive data requirement

UNCERTANITIES IN DEMAND FORECASTING

Environmental changes

Technological changes

Shift in government policy

Developments on the international scene

Discovery of new source of raw material

Vagaries of monsoon

COPING WITH UNCERTAINTIES

Conduct analysis with data based on uniform and standard definitions.

Ignore the abnormal or out-of-ordinary observations.

Critically evaluate the assumptions

Adjust the projections.

Monitor the environment.

Consider likely alternative scenarios.

Conduct sensitivity analysis