Quantitative Methods:

Based on historical information that is usually available within the

company. Various techniques are:
Trend Analysis:
A method for forecasting sales data when a definite upward or
downward pattern exists. Model includes double exponential
smoothing, regression & triple smoothing.
Seasonal Adjustment:
Seasonal models take into account the variation of demand from
season to season. Adjustments can be made to a baseline forecast to
predict the impact of a seasonal demand.
Decomposition:
A method of forecasting where time series data are separated into up
to three components: trend, seasonal, and cyclical; where trend
includes the general horizontal upward or downward movement over
time; seasonal includes a recurring demand pattern such as day of the
week,
weekly, monthly, or quarterly; and cyclical includes any repeating, nonseasonal pattern. A fourth component is random, that is, data with no
pattern. The new forecast is made by projecting the patterns
individually determined and then combining them.
Graphical Methods:
Plotting information in a graphical form. It is relatively easy to convert
a spreadsheet into a graph that conveys the information in a visual
manner. Trends & patterns are easier to spot & extrapolation of
previous demand can be used to predict future demands.

Econometric Modeling:
A set of equations intended to be used simultaneously to capture the
way in which dependent and independent variables are interrelated.
Life Cycle Modeling:
A quantitative forecasting technique based on applying past patterns
of demand data covering introduction, growth, maturity, saturation,
and decline of similar products to a new product family.
Qualitative Methods:

Based on subjective information such as intuition or informed opinion.

This type of forecast is essential for new products where no historical
information is available. This type of forecast is primarily used for
medium & long term planning. Qualitative techniques include the use
of information gathered from:
Expert Opinion:
The opinions of experts in the particular area are sought. Experts give
their views on current trends & likely future developments that may
have an impact on the general economy or a specific industry or
market.
Market Research: Conducted thru surveys.
Focus Groups: Consists of panels of customers who are asked to
provide their opinions about a product or service.
Historical Analogy: The sale of new product or service is compared
with the sales of a previous similar product or service.
It is assumed that the sales patterns associated with the previous
product or service can be transferred to the new product or service.

Delphi Method: A qualitative forecasting technique where the

opinions of experts are combined in a series of iterations (repetitions).
The results of each iteration are used to develop the next, so that
convergence of the experts opinions is obtained. This method is
based on the knowledge & judgment of a small group of experts. In
many companies a mixture of both historical information (analyzed by
quantitative technique) combined with qualitative input (from groups
of experts) is useful in establishing a more accurate forecast.
Panel Consensus: A group of people provides opinion about the
future & a facilitator brings the group to a consensus. The groups as
whole would make better decisions than would each member
individually.