What is business forecasting all about? The concept is really the same as weather forecasting; you want to know what it’s going to be like out there the next few days. Only with business, you don’t just want to know about the next few days – you want to know about the next few years, if you can! There are also a lot more factors than most people worry about with weather.
Watching the weather, most people stop after hearing the expected temperature, or maybe just whether or not the sun will be out. The entire point of business forecasting is to take into account a lot of different factors. Not only do you need to factor in the changes in general business and the economy, you’ll also need to factor in the kind of business you’re running, the kinds of products you’re offering, where you’re offering them, and what kind of business you’ve been doing already.
That’s a lot to keep track of. When you’re trying to predict how a certain product will be received, you can rely on some facts and guess-and-check methods. You can also rely on spreadsheets and other common prediction methods. These can get you some level of success with business forecasting, and some simpler companies may be perfectly content to rely on this kind of prediction. But if you’ve got a more complex system running, you may want to look into buying some business forecasting software.
But what’s the point of forecasting software, if you can just use a spreadsheet? The whole point of forecasting software is to save you the trouble of needing to do all the calculation yourself. Not every businessman is also an accountant or math guru, and if you want to keep track of a lot of different data and functions, you may need some help to get you through it. If you’ve got a particularly complicated pool of data, forecasting software can help you to sort through it more easily.