Nov 12, 2021 | 4 min read
Sales forecasting software is a tool that allows retailers to be aware of how many and what kind of sales they’ll make in the future. There are many moving parts in the retail industry and having reliable forecasts of future demand helps companies be more successful.
People around the world might describe 2021 as “unpredictable,” “full of surprises,” “challenging,”“stressful,” “too much and too little,” and the list could go on. Both 2020 and 2021 have been filled with unexpected hardships, awkward situations, new experiences, and countless learning opportunities.
While the COVID-19 pandemic was the precursor to many residual effects, there are currently many unplanned for situations that aren’t completely due to the pandemic. To stay afloat, many companies could meet these unexpected events with sales forecasting tools.
Using previous data like sales records, past trends, consumer profiles, current conditions, and more sales forecasting software accurately predicts what future demand looks like. Sales forecasting tools strengthen the businesses that use them by giving them a solid foundation to plan on. Rather than “making a best guess,” retailers make plans that align with forecast consumer demand.
An example of this can be seen most holiday seasons. It’s the beginning of October, and if you go into most stores, they have Christmas decorations on display. Many people get annoyed and mutter under their breath, “it isn’t even Halloween or Thanksgiving yet!” “Why would they already have Christmas stuff for sale?!” If you’ve ever had thoughts like these, you’re not alone. However, there’s a reason retailers do this, and it’s not to annoy their customers.
It’s hard to believe, but holiday merchandise wouldn’t be displayed months in advance if people didn’t buy it so early. Using retail sales forecasting, businesses identify the trends of their customers, and it seems like most find their holiday products to be in demand way before the actual holidays.
The above example happens annually, and retailers prepare for their consumer’s demand using different types of sales forecasting software. However, there are constantly situations taking place that companies aren’t as prepared for.
Supply Chain Current Events
People everywhere are starting to eat out, shop, and travel again. It’s exciting for people to finally be getting back to some forms of normality. However, with a steady stream of unexpected changes, retailers across the nation are struggling to function adequately.
Due to various factors, the nation is experiencing a labor shortage. Many hospitals are currently facing issues caused by this labor shortage. Some of these problems are in locations that are not COVID hotspots. In Michigan, a major hospital chain can’t use 5% of their beds because they don’t have enough employees to care for any additional people. The hospitals are turning away people who they normally wouldn’t, and the workers they do have are having a hard time doing so.
In Massachusetts, 1 out of 5 beds is empty in nursing homes for disabled adults. There just isn’t enough staff, and companies are going to great lengths to encourage more people to come and work. They are offering increased pay and other benefits. Overtime has doubled in some areas due to this lack of staff.
There is a constant stream of conflict and opinions circulating all around us, but one area many people can find common ground is in their love for Christmas. Unfortunately, there are already projections that the retail industry is going to have a negative holiday season. These complications are the result of multiple factors.
It’s no secret that the cost of shipping containers has risen astronomically. Only a year ago it cost about $2,000 to ship a container. Some companies are now paying $20,000 per container! Even with these high prices, shipments are still taking weeks, even months, to arrive. Recently, there was a large shipment of popular toys that sat for 6 weeks at the port of its destination without being unloaded and taken to retail locations.
There is an explanation for this unfortunate and current reality. Companies are trying to catch up to the demand they’ve missed out on over the past year. Cargo containers are being shipped at maximum capacity and quantity. At the Port of Long Beach, the average ship brought 4,000 containers before the pandemic. Now, they’re coming in with 7,000 containers. This might seem like a good strategy, but these mass amounts of containers are presenting new problems.
This article may seem like a compilation of random supply chain facts. However, we’re sharing this with you to bring awareness of the benefit of sales forecasting software. In today’s world of constant surprises and change, you need a dependable and accurate system.
Avercast offers the best sales forecasting software available. We’ve spent over 40 years gaining industry experience, so we can confidently say that our sales forecasting tools are the best there are.
With retail sales forecasting software you can know what products and services are going to sell, and then you can make appropriate plans to meet this upcoming demand. This gives your company an entirely new sense of freedom as you have a clear perspective of what’s down the road. You can ensure your inventory is accurate, have an appropriate amount of labor, see improvements in your warehouse operations, and probably most importantly, recognize the growth of your revenue as you use forecasts to efficiently allocate the resources you have.
With 250+ algorithms, using Avercast’s retail sales forecasting software will guarantee benefits to your company. Our experts can talk specifics with you, so sign up today for a free call or demo!