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23 May 2016

Sales Forecasting

     Sales forecasting plays an important role in the process of efffective marketing planning. Business, by nature, has an element of un certainity which give risk to risk. The risk can not be altogether eliminated but through planning and budgeting it can be reduced to a minimum level. Sales forecasting is also a step in this direction. Sales forecasting is the most important aspect of the Budgeting process. It is not only the commencement of sales budgeting but of budgeting as whole. In the words of J. Batty. "For many types of Business, the sales forecast is the commencement of budgeting. The quality of the company's product which can be sold may be the principal budget factor, and therefore, it is around this that the system revelves. When demand is assured, selling is principally a matter of producing as much as possible at the right price". Hence, sales forecast must be made after careful analysis and estamination of internal and external circumstances.

     According to American Management Association, An estimation of sales in dollars or physical units for a specified future period under a proposal marketing plan or programme and under an assumed set of economic and other forces outside the unit for which the forecast is made.

IMPORTANCE OF SALES FORECASTING::

      There can be no effective business planning with out estimates of sales. Sales forecast or demand forecast is the starting point in customer - oriented business planning. It is also useful when planning the quantity to be purchased or manufactured, when and what should be bought or manufactured, when the amount to be spent and on what promotional activities and for preparing the marketing budget. Forecasting is no  doubt a precarious affair because it involves prediction of the future events when many of them are uncomtrollable i.e., the weather, competitive behaviour and govt. activity, There are, however, controllable determinants such as product quality, price, advertising, distribution and service,. As a planning premise, it is regarded a key to interna business planning. It is only on the basis of sales forecast that business and capital outlays and various policies are formaulated and finalised.

METHODS OF SALES FORECASTING::

     Forecasting future demand is the first step in planning for production or in planning for sales in the market we need a demand estimate for the future in production as well as in sales or marketing planning., some basic sales forecasting methods;-

  • Executive Opinion
  • Expert Opinion
  • Dephi Method
  • Sales Force Composite Mothod
  • Survey of Buyer's Method
  • Market Test Method
  • Market Share Method
  • Market Survey Method
  • Analytical Method
  1. Time series analysis
  2. Correlation analysis
  3. Regression analysis
  4. Extropolation method
  5. Exponential smoothing
  6. Complex Econometricc models
  7. Moving average methods.

10 May 2016

What is Marketing Organisation ?

MARKETING ORGANIZATION ::


              The set of relationships amongst marketing ersonnel may be reffered to as Marketing Organization

     Structure and grouping of their activitis under the leadership of a marketing manager may be termed as marketing department. The success of marketing strategy to a large extent is linked to marketing organisation. Basically, the structure of a marketing organisation will have direct relationship to the marketing orjectives to be performed and the marketing tasks to be achieved. As a variety of marketing tasks have to performed for realising the marketing objectives, the tasks have to be grouped appropriately and allocated to different departments and the functional relationship among them clearly stated. When this is done, the basic structure of the marketing organisation wil emerge.

OBJECTIVES OF MARKETING ORGANISATION ;:


     The main objectives of any marketing is attaining targeted sales and profits and also achieving greater customer satisfaction. There are many other objectives which a marketing team may required to achieve. The Other Objectives are as follows;;-
  • To achieve organisational coordination in a predetermined manner of all functions in terms of time and content.
  • To ensure functional performance effectiely, in a specified time period with the company's policies and objectives.
  • To optimise use of managerial time and effort thereby allowing them to concentrate essential tasks and key results areas.
  • To promote new strategies and new innovative development work in order to achieve better competitive advantage.
  • To ensure clearly defined organisational relationship among sales team members sothat there may be smooth functioning of the group.

Functional Structure of an Organization ::

          Chief Executive Officer(CEO)

Finance Manager ,             Marketing Manager,      Production Manager,     Personnel Manager.

Marketing Research Manager,                                                    Production Planning Manager.

Sales Manager,     Advertising Manager,    Sales Promotion manager.

4 P's of Marketing

Marketing Mix Variables / 4 P's of Marketing.

1. PRODUCT VARIABLES;-

  • Product line and Range
  • Design, Quality, Features, Models, Size.
  • Warranty of Product 
  • Packaging, Type, appearance and label.
  • Branding and Trade mark
  • Service, pre-sale and after sale
  • New Products.

2.  PRICE VARIABLES ;;

  • Pricing policies
  • Levels of Prices 
  • Level of Margin
  • Discounts and Rebates
  • Terms of delivery
  • Payment terms, credit terms
  • Resale price maintenance

3. PLACE VARIABLES :: 

  • Channels of distribution
  • Types of intermediaries
  • Location of Outlets
  • Channel policy & design
  • Channel Remuneration
  • Dealer-Principal relations
  • Physical Distribution
  • Transportation, warehousing
  • Inventory levels
  • Order processing

4. PROMOTION VARIABLES ::

  • Advertising, media-mix
  • Level of efforts, personal selling
  • Quality of sales force
  • Cost level, level of motivation
  • Budgets, allocations and programmes
  • Sales promotional efforts, display, contest
  • Trade promotion
  • Publicity and public Relations.