Sales Management
Chapter 5 120 – Sales forecast, quotas
• sales forecast: the future market potential for a specific product
• quota: sales goals for different sales territories and individual people 121 – contingency, sales and operational planning
• contingency: events that are conceivable but less likely than those based directly on the forecast
• sales and operational planning (S&OP): an organized process that uses sales inputs to forecast business for upcoming periods of varying length 123 – SIC, NAICS
• standard industrial classification (SIC): a uniform numbering system for categorizing nearly all industries according to their particular product or operation
• North American Industrial Classification System (NAICS): a system for categorizing firms, formally adopted beginning with the 2002 Economic Census and the publication of the 2002 US NAICS Manual 124 – buyer intention
• buyer intention: the likelihood that customers will actually purchase a given product, can be estimated using surveys 126 – nonquantitative forecasting techniques
• subjective forecasts based on knowledgeable people’s opinions instead of being analytically derived, often called subjective forecasts – two types: judgment methods and counting methods 129 – time series method, moving averages
• time series method: use historical data to predict future sales, look for four factors (trends, periodic movements, cyclical movements, erratic movements)
• moving averages: forecasts developed mathematically based on sales in recent time periods 131 – causal methods
• methods that attempt to identify the factors affecting sales and determine the nature of the relationship between them; also called association methods
• different types: correlation analysis, regression analysis, econometric models, input-output models 136 – evaluating forecasting approaches
• several criteria should be considered o comprehensibility – the way estimates are derived o accuracy o timeliness –
• sales forecast: the future market potential for a specific product
• quota: sales goals for different sales territories and individual people 121 – contingency, sales and operational planning
• contingency: events that are conceivable but less likely than those based directly on the forecast
• sales and operational planning (S&OP): an organized process that uses sales inputs to forecast business for upcoming periods of varying length 123 – SIC, NAICS
• standard industrial classification (SIC): a uniform numbering system for categorizing nearly all industries according to their particular product or operation
• North American Industrial Classification System (NAICS): a system for categorizing firms, formally adopted beginning with the 2002 Economic Census and the publication of the 2002 US NAICS Manual 124 – buyer intention
• buyer intention: the likelihood that customers will actually purchase a given product, can be estimated using surveys 126 – nonquantitative forecasting techniques
• subjective forecasts based on knowledgeable people’s opinions instead of being analytically derived, often called subjective forecasts – two types: judgment methods and counting methods 129 – time series method, moving averages
• time series method: use historical data to predict future sales, look for four factors (trends, periodic movements, cyclical movements, erratic movements)
• moving averages: forecasts developed mathematically based on sales in recent time periods 131 – causal methods
• methods that attempt to identify the factors affecting sales and determine the nature of the relationship between them; also called association methods
• different types: correlation analysis, regression analysis, econometric models, input-output models 136 – evaluating forecasting approaches
• several criteria should be considered o comprehensibility – the way estimates are derived o accuracy o timeliness –