Sales Forecasting Research Assignment: Apple Company (Essay Sample)

Sales Forecasting
Student’s Name
Institution Affiliation
Sales Forecasting
Apple Company is a technological company that deals with the design, development, and sale of electronics, online services, and computer software programs. The company is well-known across the world for its quality and up to date product and services. Years after its foundation Apple has turned out to be the leading information company in the world ("Apple Info - Apple," n.d.). The Company embraces rapid technological advancement which has significantly contributed to its success in today’s market. Consequently, modern technological differentiation and market globalization have resulted in stiff competition for most markets. However, Apple Company has been able to stay afloat in the market by improving the quality of products and introducing new products in the market. On the other side, sales forecasting is vital for Apple, and through it, they have been able to make decisions for their future sales, fiscal growth, and development. Accurate sales forecasts give Apple company better insights during the product sales stages (Schwartz, 2006). For instance, through sales forecasting Apple can make decisions on whether to launch a new product or not, whether to withdrawal a recently launched product or not due to plummeting early stage sales.
Sales forecasting is probably the most vital area of the whole business plan of the Apple Company. The vitality of a sales forecasting report to a business is its ability to give some educated business hindsight through an introspective but optimistic analysis of economic indicators, to the top brass management of the company. A sales forecasting report takes into account several factors, which include general market and marketing trends, the demand and supply of the product or service to be offered, and seasonality among others. Primarily, this sales forecast report provides updates on the current economic conditions of the economy using newly arrived data spanning from the previous years' sales and financial reports. Characteristic of the interval sales forecasts selected is the switch between lowbrow and highbrow statistical confidence bands to enable the actual statistical realizations made from the forecasts using actual values to fall within arranging that is preferably closer to the mean to attain high accuracy sales forecasting.
Additionally, through Sales forecasting, Apple will be informed on the company’s overall forecasts of profit from sales in determining their future financial position. Moreover, sales forecasting plays a central role in the ability of an organization or company of Apple’s stature to raise capital investment. Consequently, the ability of sales forecasts to determine the injection of investment by a company subjects them to considerable scrutiny by potential or prospective investors that would want to inject direct investment into the company. Using sales forecasting, Apple can leverage its sales forecasting abilities or strengths to proactive corporate performance management against the plan and improve alertness and responsiveness to unprecedented fluctuations in the operating environment of the company's business.
Through sales forecasting, Apple will be able to take proactive and preemptive measures and actions to mitigate the rigors, risks, and harshness of the business' operating environment and not only pursue but also explore and exploit new ventures and opportunities. In such a way, it will help the company to improve its organizational awareness and responsiveness to sales fluctuations in the market, identification of new consumer trends, market niches, and new sales market opportunities. Furthermore, sales forecasting is imperative to Apple company for purposes of not only providing the basis for the assessment of the company’s long-term strategic sales plans, sales and fiscal position but also help in the planning and acquisition of additional resources meant for injection into the company to aid in achieving the laid down sales targets.
Market Size
Apple’s market share has continually grown since its foundation. The company has established a stable market for its products by focusing on expensive but highly engineered products. In this case, the Apple Company is forecasting the market size for its projected sales, and credible series data are available for consumer habits on their products and services. Other external factors that influence the level of sales are demography and economy which revolves around the size of population and its distribution, age of the consumers and their disposable income. Conversely, Empirical statistics about the market size and its dynamics point to allowances and generalizations about price and income elasticities regarding sales forecasting. If Apple is planning to offer a new product to the market with projected high sales realization, there is a need for them to forecast the market and the pricing.
Apple can use the following approaches regarding pricing strategies for new products, the company could adopt to attain its sales targets, and they include price skimming and penetration pricing. The former, price skimming opts for an initial high rate that is poised to take advantage of the projected high demand in the market that follows the launch of a new product (Kahn, 2006). The latter, penetration pricing opts for an initial fair price as it attempts to gain a huge chunk of the existing market, targeting dominance of the new product before competition from rival companies with similar products. Consequently, for Apple to realize its sales, the forecast indicates that the market size would dictate the price it would bear so as to be market and price sensitive. Market size and price sensitiveness would translate to regular sales as the frequency of consumption would not have been affected. In such a way, Apple Company will have to come up with the price for their products or services by focusing on the current situation in the market, and operating environment is in and its particular product about competitors. Apple company will thus be forced to come up with prices that are align to the customer needs and expectations based on the market trend, which will provide it with the highest sales possible.
Trend Analysis Summary
Over the years, Apple Company has conducted a series of surveys on the American technology and telecommunications industry. Facilitation of the said surveys was made possible through the dissemination of questionnaire sheets and receiving responses via fax and as input over the Internet. Apples have a particular interest in sales and sales forecasts to promptly comprehend sales and marketing trends not only in the American but also in the global telecommunications industry. The current civil and technological differentiation and blanket globalization happening have necessitated the company's to adjust to current communication trends. Furthermore, due to the rapid technological advancement, Apple has been forced to conduct surveys of the sales and sales forecasting to reach many consumers hence the use of the Internet over the conventional fax.
Survey Target
The survey items used during the sales forecasting survey included sales conditions from previous monthly surveys, and quarterly surveys of sales forecasts, sales flow forecasts and business operating environment conditions forecasts. By sales share in each business category and classification in the American telecommunications, industry that the Apple Company mainly serves. In the previous fiscal and sales year in which the said conducted surveys, facilitated 100 rival companies in the overall telecommunications industry used as case studies to determine the number of samples for each business category and classification. Using total sample basis and on a random sampling basis anchored on a two –step data process determined the number of samples in each business category and classification taking care to minimize the standard error. Consequently, about the total sample mentioned above, top companies in sales in the telecommunications industry underwent extraction until the number of companies equaled the determined number of samples obtained above. The remaining population, after the extraction of top companies, were subject to another random sampling procedure.
Market Segmentation, Analysis Summary
Concerning Apple market segmentation in sales forecasting, plans to market products, service or the company depends on the decision made by Apple Company management. The firm has to decide whether to segment its existing products or target market that includes a group of customers or users with common needs. Aggregate market segmentation appears to pick up some traction hence for each market segment, or group Apple Company intends to use sales pitching and promotional techniques with the aim of increasing sales going by the high projected kind and levels of demand and supply that also project an increase in sales. The first step that usually taken while coming up with new products or services is segmentation of the market (Kahn, 2006). Markets segmentation comes in different ways that include customers, users, and supporters.
Customers segment to include as to their areas of residence preferred shopping areas and powers and abilities, consumer mannerisms, supplier loyalty, social class, benefits sought required, lifestyle, or social structure among others. Users’ segmentation to include disposable income, socio-economic, relative dependency, and language among others. Supporter tend to be involved either directly or indirectly to include ethical supporter or advocate.
Competitive Identification and Analysis Summary
Apple Company operates in a rather competitive market. However, this has not hindered their success over the years. The company has b...