Article

Marketing and Sales

Philip Hans Franses

in The Oxford Handbook of Economic Forecasting

Published in print July 2011 | ISBN: 9780195398649
Published online September 2012 | | DOI: http://dx.doi.org/10.1093/oxfordhb/9780195398649.013.0026

Series: Oxford Handbooks

 Marketing and Sales

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Sales forecasts are important for inventory management and for marketing. Inventories can be kept at appropriate levels, and marketing efforts can be addressed in the event that sales projections do not meet a firm's aspirations. This article discusses forecasting methods for durable products, such as high-definition television and hybrid cars, and methods for regularly purchased stock keeping unit (SKU) products like food products. Section 2 begins with durable products. The typical model used for forecasting is the Bass (1969) model, or one of its many variants, which can be extended to capture sales of sequential generations, and multilevel versions are also available. This section reviews various recent developments concerning the Bass model. Section 3 deals with forecasting SKU-level sales data. Due to the fact that such forecasts have to be made on a frequent basis, and also for many products at the same time, it is quite common to have automated programs generate forecasts and to have managers give those forecasts a final twist. Recently this practice has become the topic of much research because of the availability of detailed databases. A review of the findings in this literature is provided. The final section suggests a summary of the current state of the art and gives a few further research topics.

Keywords: sales forecasting; inventory management; durable products; Bass model; stock keeping units

Article.  5983 words. 

Subjects: Economics ; Econometric and Statistical Methods and Methodology: General

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