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Demand Forecasting Issues

   

Added on  2019-10-12

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Running head- Contemporary LogisticsCONTEMPORARY LOGISTICS
Demand Forecasting Issues_1

1Contemporary LogisticsQuestion 1 Discuss several demand forecasting issues and possible ways of reducing the negative impacts associated with those issues?Answer 1 Demand forecasting is done in a way to predict the future demand for the particular goods or services. So it is very crucial to have proper demand forecasting. As it requires a lot of technical and analyzing skill to predict the future demand for the particular product (Raza et al., 2015). It can be possible through analyzing the historical data or by just making a judgment or byanalyzing the time series. Several issues of demand forecasting: issues are related to money and sufficient budget and selecting the appropriate techniques of forecasting.1. If demand forecasting is not taken seriously before the producing or manufacturing of the product, it may lead to no sell. 2. Demand forecasting is dependent on prediction and probability. With the ever-changing dimensions of the market, sometimes it is very difficult to say what may click with the customers. Sometimes what has worked for them, might not work for them this time.3. overestimation and underestimated are 2 kinds of forecasting defects. Overestimation may lead to wastage of inventory wrong capacity planning and as a whole wastage of money. Underestimation, as we know, will lead to not meeting up the demands, and it will create dissatisfaction among the customers and loss of loyalty (Daganzo et al., 2014). So both ways, it is harmful.
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