Business – 8.1 Marketing analysis – Sales forecasting | e-Consult

Three‑month simple moving average forecast for June:

Implications for production planning:

• The forecast of 1,360 units suggests that production should be scheduled to meet this level, avoiding both excess inventory and stock‑outs.
• If the forecast is higher than the previous month’s output, the firm may need to increase raw‑material orders, schedule overtime, or add shifts.
• Conversely, if the forecast is lower than capacity, the business can reduce overtime, defer non‑critical orders, and free up warehouse space, improving cost efficiency.
• Regularly updating the moving average each month ensures that production plans remain responsive to recent sales trends.