Nowadays, almost every decision made by a business professional involves some kind of forecasting. Business managers require forecast tools to study trends and make predictions to cope with changes in demand, competitive pricing strategies, seasonality, strikes and economic swings. In simplest terms, forecasting is a method to predict future outcomes based on past events and future insight.
The Need for Forecasting in Business
Forecasting is an essential aspect of business strategy. Organizational heads are constantly faced with demanding questions that need prompt answers. These could include anything from measuring market impact, predicting sales, or understanding the need for workforce expansion.
Forecasting helps businesses to conduct a critical assessment of where they stand in the present. It also helps them predict the future growth of their company future market areas. Hence, forecasting tools are crucial for key responsibility areas such as planning, budgeting and goal setting.
The main function of a business forecast tool is to help companies look beyond their current market position. Business forecast tools can aid in predicting budgets, sales and much more. Companies benefit from having an accurate picture of their market and business potential. Hence, data and market trends can help in setting and meeting business objectives.
Read on to learn about some popular fundamental forecasting tools and techniques for effective planning.
Business Forecasting Techniques
What is forecasting in business? Corporations use many business forecasting methods to understand historical trends and potential demand. Here are some of the commonly used forecasting models for a long-range forecast.
Quantitative Forecasting
Quantitative forecasting methods predict the future by looking at historical data. It is used to analyse large amounts of historical data to discern trends and patterns. They include method-based, measurable and analytical tools for statistical forecasting. This is useful for short-term goals and long-range forecastings such as revenue forecasting and sales forecasting.
Qualitative Forecasting
Qualitative forecasting methods are useful when companies have scarce data and reports. For example, when a brand new product or service is launched in the market. For startup firms, analyzing past data is not possible. Hence, they opt for a subjective approach considering market research and the opinions of industry experts.
Factors like rating schemes and human judgement help to convert qualitative information into quantitative estimates. Hence, systematic and logical information and unbiased judgement comprise qualitative forecast methods.
Causal Forecasting
This type of forecasting in business helps to predict and understand how to forecast future relationships. It is considered the most sophisticated type of forecasting tool.
It can mathematically express relevant causal relationships such as inventories and market survey information.
Using a sales forecast example, a sudden downturn in sales could be either due to a bad economy or unsatisfactory customer service. In order to strategize better, there should be a thorough analysis and understanding of the two data sets.
Forecasting Tools: An Introduction
Strategic forecasting requires reliable and accurate data for effective management and operations. Proper forecast tools are necessary to find, gather and analyze past and present data. We have compiled an extensive list of popular business forecasting software.
Popular Business Forecast Tools
1. QuickBooks
This forecasting tool is a go-to resource designed for accountants requiring financial software. The multipurpose platform helps to generate trends and forecasting reports. These are essential for companies to accomplish financial and budgeting objectives.
QuickBooks is an accounting software package that helps users manage their books anytime using multiple devices. By creating access privileges, colleagues and accountants can easily log in and work with data online. Small businesses can use QuickBooks online login to know how much money is owed at any moment as the data is automatically synced and backed up.
With over 3.3 million users globally, Intuit QuickBooks is the highest rated mobile app for accounting software with 4.5 stars. According to the QuickBooks website, the forecast software claims to be the world’s number one forecasting tool.
Watch the video below to understand how QuickBooks provides a smarter way to forecast trends:
Vendor Details
- Developers: Intuit. Inc
- Release: 2018
- Operating System: Microsoft Windows, macOS (US)
- Country: United States
- Type: Accounting software
- Website: www.quickbooks.intuit.com
Features
- Cloud accounting for mobile, computer and tablet
- Invoicing through customized, professional sales receipts, estimates and invoices
- Expense tracking for tax time
- Accounting reports with customizable dashboards
- Cash flow management for vendor bills and recurring payments
- Accountant access to manage records from anywhere and anytime
- Automatic backups through QuickBooks Online for updated data every day
- Data security similar to bank security levels
- Free unlimited QuickBooks support available Monday to Friday, 7:00 am to 12:00 am (GMT+8)
Learn more about the QuickBooks online login and features on the Intuit website. Click here for more information.
Pricing Plans
- Free 30-day trial
- SimpleStart: $15.00/ month
- Essentials: $23.00/ month
- Plus: $31.00/ month
Users can save 50% for the first six months. Click here to learn more.
Uses and Applications
QuickBooks is used by small businesses, accountants and bookkeepers. It can be used to:
- Create and send professional invoices
- Get ready to use reports Design and create professional quotations
- Track sales, invoices, supplier bills and payments
- Track cash flows with balance sheet and P&L statements
- Import transactions automatically by using bank connect
- Create budgets and purchase orders
- Includes new features and free updates
- Access to open APIs as per business requirements
- Import data using Excel spreadsheets
Competitors
- Freshbooks
- Zoho Books
- Xero
- Wave
Benefits
- Client taxes are made easier by tracking income and expenses in one place
- Less manual data entry through the easy import of the client’s bank and credit card transactions
- Easily share books with clients to answer questions and resolve client issues
- Know the client’s financial health with over 65 built-in reports including accountant-specific data
- Real-time receipt capture via phone for an up-to-date view of expenses
- Connect to Intuit-approved third-party apps that integrate with QuickBooks Online to expand functionality.
Customer Reviews
- “With QuickBooks, I feel like I’m on a roll. It’s been totally worth it!” – Katie Lynn, Molten Wonky
2. “Before QuickBooks I dreaded the accounting side of my business. Now I can get everything done in minutes and spend time doing what I love.” – Ash Read
3. “We use the QuickBooks app when we’re visiting customers… we can now send a quote or invoice on the spot.” – Amanda, Barking Mad
4. “I save 6 hours per week doing my books on the go.” – Loui Evripidou, St. Loui’s Pizzas
2. Demand Works Smoothie
Demand Works Smoothie is a useful forecasting software for businesses that run on browsers. The forecast tool can be run from servers, desktops and the cloud. It provides demand and supply planning solutions to deliver large-scale improvements for forecast accuracy, asset coordination and utilization.
Demand Works focuses exclusively on areas such as forecasting, inventory optimization, finite capacity planning and S& OP. The demand planning software has been specifically developed for inventory management, sales, capacity and operation planning.
Available in 6 languages, the forecasting software is used by over 400 SMEs and large corporations across the United States, Canada, Latin America, Australia, Europe and other parts of the world.
Vendor Details
- Developers: Advanced Planning Systems
- Release: 1993
- Operating System: Cloud, SaaS, Web, Windows
- County: United States
- Type: Demand and supply planning software
- Website: www.demandworks.com
Features
- Demand planning and forecasting
- Inventory planning and optimization
- Capacity planning and S&OP
- Date visualization
- Historical reporting
- Planned vs actual tracking
- Product introduction planning
- Promotions management
- Sales forecasting
- Supply forecasting
- Replenishment management
Pricing Plans
- Cloud Smoothie®: $750.00 to $5,000.00/ month
- Smoothie® Desktop: $5,000.00 plus $1,000.00 in prepaid annual maintenance
- Smoothie® Server: Starting from $15,000.00 for the most basic configuration
Click here to contact Demand Works to know their complete pricing information.
Uses and Applications
Demand Works Smoothie is used by manufacturers and distributors of household brands and industrial goods.
Smoothie Intro Video – Demand Works Company
Competitors
- JDA Inventory Optimization
- Demand Solutions
- Oracle Demantra,
- EFI Metrix Planning and Imposition Software
- SAP Integrated Business Planning
Benefits
- A comprehensive suite for S& OP
- It is a highly accurate automatic forecasting engine for level, trended, seasonal or intermittent time series
- Offers Pivot Forecasting®, a unique technology which makes it possible to forecast at any level with a mixed product, customer, channel and geographic hierarchies
- The ability to link items and borrow history from a predecessor or similar items
- Offers advanced forecast performance management
- Provides support for events, promotions and new products
- Multiple scenarios, extensive support, and role-based security for collaboration
Customer Reviews
- “Over the course of one year, we reduced lead times on key products by over 50%, improved forecast accuracy, reduced inventory by 16%, and kept customer on-time delivery at previously high levels.”
— SUPPLY CHAIN DIRECTOR, STERIS CORPORATION
2. “We achieved full payback on the software and implementation in about two months.”
— OPERATIONS MANAGER, CONMED CORP.
3. “Before we implemented Smoothie, our forecast accuracy was averaging about 40%. Now, it’s consistently over 75%.”
— SENIOR DEMAND PLANNING MGR., TREX INC.
4. “We are impressed with the scalability of the program as well as the ease of use. The learning curve during implementation was very short, and it helped to improve fill rates and reduce on-hand inventory by over 15%.”
— VICE PRESIDENT, BLUE BUFFALO CO
3. Tableau Software
This well-known tool is touted as one of the best forecasting software for business intelligence tools. It helps businesses to get an accurate picture of various business areas and create strategies for managing data. The Tableau software is used by everyone from small businesses and early-stage startups to global enterprises.
This popular business forecast tool can connect to data stored anywhere and in any format. Users can easily perform ad hoc analyses to reveal previously hidden opportunities. They can simply drag and drop to create interactive, intuitive dashboards with advanced visual analytics.
Watch the video below for an overview of the unique features of the Tableau software:
Vendor Details
- Developers: Tableau Software
- Release: 2003
- Operating System: Windows 7, Windows Vista, Windows XP, Mac OS, Linux, Web browser (OS agnostic), Windows 8, Windows 10
- Country: United States
- Type: Data analysis software
- Website: www.tableau.com
Watch the video below to understand how the Tableau Software can help share valuable insights in seconds:
Pricing Plans
- Free 14-day trial
- Tableau Prep: Prepare data for analysis; combine, shape and clean up data
- Tableau Desktop: The ‘gold standard’ in visual analytics
- Tableau Online: Skip the hardware set up and take it to the cloud
- Tableau Server: Share dashboards across enterprises
Click here to learn more and start the Tableau software free trial.
Individuals
- Tableau Creator: $70.00/ month billed annually
Teams & Organizations
On-premises or public cloud
- Tableau Creator: $70.00/ month billed annually
- Tableau Explorer: $35.00/ month billed annually (minimum 5 explorers required)
- Tableau Viewer: $12.00/ month billed annually (smallest 100 viewers required)
Fully hosted by Tableau
- Tableau Creator: $70.00/ month billed annually
- Tableau Explorer: $42.00/ month billed annually (minimum 5 explorers required)
- Tableau Viewer: $15.00/ month billed annually (minimum 100 viewers required)
Uses of Tableau
- Healthcare Analytics
- Education Analytics
- Government Analytics
- Insurance Analytics
- IT Analytics
- Marketing Analytics
- High Technology Analytics
Applications
- Communications, media, & technology
- Healthcare and life sciences
- Retail and consumer goods
- Financial services
- Public sector
- Travel and transportation
- Manufacturing
- Services
- Energy and resources
Competitors
- SAP BusinessObjects
- IBM Cognos
- Oracle
- Sisense BI
- Microsoft Power BI
- Domo
Benefits
- There are options available for everyone in an organization; from individual analysts to large teams
- An all-in-one platform sans any hidden costs
- Delivers a complete analytics experience
- Reduces the cost to deploy the best analytical tools
- Easy to start and scale providing flexibility
- Not just a forecast software — a wholehearted commitment to R & D, free training and a vibrant community of users
- Offers academic programs for qualified instructors and students with free licences
Awards and Accolades
- Codie award winner for “Best Business Intelligence Solution” by the Software and Information Industry Association (2008)
- The leader in the Gartner Magic Quadrant (2012-2017)
Customer Reviews
- “Tableau helps visualize needs from our business partners and provide that in a very easy-to-consume way.”
—Michael Li, Senior Director of Business Analytics
2. “With Tableau, we gained efficiencies by 95%. People are spending a lot more time doing their true job rather than just churning out reports.”
—Santhosh Nair, Head of Analytics, BI & Visualization, Lenovo
3. “With Tableau, we can align all of our reporting and tie back a branch’s contribution to the overall company results, which helps us better understand the impact that they’re having.”
— Jackie Chin, Vice President of Retail Analytics, Charles Schwab
4. “By using Tableau, we were able to accelerate the processes considerably. This allows us to automate and standardize most of the standard reporting. I would say that we now have about 30% more time to dig deeper and carry out analyses that are more specific. In this way, Tableau helps us to evaluate the exponentially growing volumes of data and to keep pace with the changes in our industry.”
—Christian Novosel, Head of Strategic BI Initiative at Lufthansa
Watch the video below for a peek into how SMEs thrive using the Tableau Software:
Conclusion: Forecasting in the Future
After discussing forecast tools and techniques in such detail, it will be apt to predict short and long-term forecast techniques. It is not too difficult for businesses to forecast the immediate future. This is because long-term forecast trends do not change overnight. Most of the forecast tools and techniques described above are still in their early application stages. Thus, it is most likely that they will continue to be in use for at least the next five years.
Here’s a sneak peek into the forecasting and business intelligence trends in 2019:
Forecast tools and techniques are definitely not a crystal ball for the future. However, they help conduct an accurate and reliable assessment of information of the future of a business. As company’s set their goals, they can use the best forecast tools and techniques to plan and execute strategies to accomplish them.
SEE ALSO: How Google Innovates: The Road map of Excellence
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