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10 Forecasting

Forecasting requires a little math and a little logic. For example, does your forecast predict your product will acquire half a segment’s sales when there are four or five products in the segment? Unless your product’s positioning, age and MTBF are significantly superior to the other products and your price is at the low end of the range, it is not likely that you will acquire half the sales. Does your forecast predict you will take only one tenth of the sales when there are four or five products in the segment? Unless your product’s positioning, age and MTBF are significantly inferior and your price is at the high end of the range or above, chances are you can sell more.

Forecasts are used by the proformas to calculate financial projections. If you enter a forecast that is unrealistically high, the proformas will take that forecast and project unrealistic revenue. If you do not enter values in the Your Sales Forecast cells, the proformas will use the Benchmark Prediction to project financial results.

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