Manage your e-commerce’s demand forecast for Halloween
10/11/2022 - Pricing strategy
When sales increase, like for Halloween, e-commerce businesses must know expected demand to ensure they meet consumers’ needs. This year, in particular, sales of costumes, accessories, and sweets are expected to increase considerably. In the last few years Halloween celebrations have been dampened by the impact of COVID-19. Brands and retailers must accurately forecast demand. In other words, they must calculate as accurately as possible the future increase in the sales volume for each product to ensure they have sufficient stock.
This demand forecast will depend as much on the time of year as on how a product’s sales evolve over time, and on the pricing and marketing strategy in place for each item. Numerous factors can complicate the future demand calculation and affect business performance. Here’s how you can calculate this demand forecast and why it’s essential to have automated tools for the job.
How to calculate your e-commerce demand forecast
There are various methods used to calculate demand forecasts, but all necessitate collecting and analysing a significant quantity of data. Studying the company’s sales history can help predict users’ future behaviour. If you do not have this data, you can choose to embark on studies using qualitative methods, such as conducting consumer surveys about specific products and services. The main disadvantage of these methods is that they require a significant investment in time and resources when done manually.
Companies now use big data-based demand forecasting tools and Artificial Intelligence techniques to avoid this. These automatically analyse how the e-commerce and the market evolve and recommend the optimal stock level for each product. These can be used at Halloween or during other peak demand seasons. Demand forecasting software makes it possible to speed up decision-making and be more prepared for these celebrations which are strategic for the online market.
Benefits of having a demand forecasting tool
- You ensure more efficient planning for e-commerce operations. You will be able to forecast costs more effectively and better organise payments to suppliers and other operational costs.
- You avoid stock-outs that can lead to loss of valuable revenue for the brand or retailer.
- You reduce stock management and storage costs by having only the items you need to cover consumer orders. At the same time, the company’s product purchasing will be more efficient, allowing you to benefit from higher discounts and better terms. For example, purchasing a large quantity of stock from suppliers at a lower price. This also promotes a higher return on investment for your inventory.
- You increase customer satisfaction, as the most popular products will always be available.
- You get quality information to help you to implement improvements in your business, such as expanding your workforce.
Demand forecasting tools like Reactev help keep brands and retailers productive and profitable and help e-commerce businesses run smoothly. This is true all year round as well as during peak sales periods like Halloween. With the help of pricing experts, you will be able to implement these systems in your company and improve demand management.
Category: Pricing strategy
