Accurate Business Forecasting Essay Example | Topics and Well Written Essays - 2000 words

Accurate Business Forecasting - Essay Example The paper analyses the aftermath of a poor forecasting and the success of good forecasting. It explains aspects concerning the platform of business operation, the means for executing the operation, and the levels of desired achievement. It details survival methodologies in a changing market and political scenario. It gives a macro outlook towards the key indicators that should be considered before venturing into a business on building construction. It encompasses almost all vital areas of business that play a role for the success and growth of the company. Why is Business forecasting important when we cannot predict the future? The answer to the question is to evaluate risks that can arise from every angle and prepare to counter them and reduce damage to business as much as possible. However, there is no forecast that is 100% right. All business forecasters strive to achieve the 99.9%. There is another side to the coin here. A business ventured with no sense of forecast can be a total failure at a very early stage. In other words forecasting sets goals for a business. The company strives for its goal and carries out its task according to a well-drawn plan based on the forecast. Building construction is an industry, which involves high amount of planning, huge capital, and careful execution .... Broadly, the company needs to analyze and accurately forecast the following three factors. Firstly, Market analysis and trend forecast. Secondly, Forecast of the company's top line and bottom line numbers, the so-called targets for growth on quality and quantity. Thirdly, Financial Analysis and the prediction of the underlying changes in the macro economy. Market Analysis and Trend forecast: This is the central nervous system of any construction company. As a start up company, it is very important to select the area of operation or to be precise the exact geography, where they propose to start and speed up business. Estimating the current demand for construction, and what would be the expected demand for future construction and the growth of competition. Market analysis and trend forecast (continued) 4 What will be the expected turn in the market condition in the geography of operation, the availability of land, the expected market potential, and how much of the pie will the company own in the future. 'Pioneer builders' a construction company chose nearly four years ago analyzed the market trend in the state of California and picked San Diego as its base of operation, as it could not afford stiff competition in cities like Los Angeles. The city of San Diego had good potential for future construction especially, a rising demand for residential construction. The company analyzed and focused its target segment and was able to drive sales and reap profits in their first project, based on the market forecast. Soon they acquired land for combined residential construction and the growing demand in the city got them better business. The company had analyzed data of almost six different prospective cities