Given the uncertainty of current markets, large companies have been forced to use different techniques to reduce this to the lowest possible levels s, among all these techniques we find the use of different predictive algorithms for the realization of statistical models that help the company in achieving the objectives.
By means of demand prediction models the company is able to stop a more precise forecast of the sales levels that it will be able to reach with a certain product and thus be able to adjust the different production processes with what will obtain a significant reduction of costs , another important section that is obtained with this model is the management of the stock which is one of the great objectives of the big companies of sectors as the retail since the existence of a too high stock or too low supposes big costs for the company.
Medium and long term demand predictive models deal with more general aspects since their impact on a company is greater and for its development will be necessary to have a large historical data. On the other hand short-term models tend to be more precise since the factors affecting demand change constantly and by shortening these times it will be easier to anticipate and adapt to them.
The most important points at the time of realizing a model of prediction of demand are:
Determine in an appropriate manner what the objective of the project is.
Measure the period of time that will be taken for the realization of the model.
Determine the best predictive model (qualitative, quantitative).
Determine the best data sources for model realization.
Generally these models are carried out quantitatively with historical data and the resulting value is adjusted according to the company's business vision.
Among these models we can emphasize models of prediction of escape of clients, models of prediction of potential clients, models of prediction of satisfaction of the client with the company and models of prediction of demand, this last one is having a great boom in the last years due to its great variety of applications.
If you want to know how demand prediction models can help your business write us and we will advise you personally.