Instead of replicating past sales into the future, model the real reasons behind demand.
Sales forecasting is the prediction of expected future demand across product, channel, customer, region, and time dimensions. Sales planning, on the other hand, is the integration of this forecast with company goals, budgets, campaigns, capacity, and inventory policies.
Demand in the furniture industry can be affected by numerous factors such as season, campaigns, housing movements, store openings, product lifecycle, delivery times, economic conditions, and project sales. Therefore, a single forecasting model may not be sufficient for all products and channels.
Sales forecasting and planning process
Defining product, channel, customer, region, and time hierarchies.
Cleaning up historical sales and demand data.
Separating stock shortages from unmet demand.
Evaluation of season, trend, campaign and other causal factors.
Generating a basic prediction based on statistical or machine learning.
Estimated assessment by sales, marketing, and operations teams.
Creating an agreed sales plan.
Planning the scenario, risks and opportunities.
Comparing actual results with forecasts.
Analyzing the causes of forecast deviations.
Planning dimensions
Product family, model, variant and collection
Stores, dealers, franchises, e-commerce, and other channels.
City, region, country, and sales organization.
Week, month, quarter, and year
Quantity, turnover, net sales, margin, and order value.
Base, optimistic and pessimistic scenarios
Measure prediction performance.
Forecasting is not just a single number, but a management input containing uncertainty. Indicators such as forecast accuracy, systematic deviation, unrealized demand, and forecast added value should be monitored regularly.
Transform the sales plan from a mere statement of targets into a shared management plan that fuels production, purchasing, inventory, and financial decisions.