What is demand forecasting?

Demand forecasting is estimating how many units of each SKU will sell over a future period, so you can buy or make the right quantity. It combines sales history, seasonality, trend, and known events such as promotions or a new retail door. The output is a per-SKU quantity by period, which is what a purchase plan needs.

A forecast is a planning input, not a prediction to be graded. Its job is to be close enough that the buying decisions it drives are right, which is a lower bar than accuracy for its own sake.

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