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Pitfall of forecasting

In forecasting, it is seldom perfect. This means that there are many outside factors that we cannot predict or control that have impact on the result. Moreover, many forecasting technique assumes that there is some underlying stability in the system. Therefore, some firms do their predictions using computerized forecasting software first and later closely monitor the product items when the demand is low. Besides that, using product family and aggregated forecasts are more accurate than individual product forecasts. This may helps balance the over and under predictions of each product. Below there are some disadvantages using different forecast analysis.

Trend forecast

The disadvantage of a trend forecast is that it produces only one result. It does not help analyze why the product demand behaves the way it does, and it provides no means to accurately measure how the changes in external variable influence the product demand. Because the assumptions......

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Approximate Word Count: 421
Approximate Pages: 2 (250 words per double-spaced page)

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