Retail Sales Forecast

Retail sales forecasting is done for several different reasons.  It is important for clothing stores to analyze their future sales projections so that they can determine the appropriate quantity of inventory to maintain as stock in the store and what level to have at their warehouse (learn about inventory management). 

Future sales projections are also needed by the garment production department so that they can plan the time & action calendars and decide how many units need to be manufactured by a particular date.  It is important to get production started at the proper time, so that it is available for the store at the time needed in the retail sales projections. 

Outside of our industry it is also important for financial institutions to be aware of future sales performance.  For example, a retail sales forecast is important to banks, factors, and even stock market traders.  Sometimes we need to know how retailers performed last year or quarter.  And we often need to understand the forecast or projection for next quarter and beyond.  Wouldn't it be great to be a stock trader that knows how well a retailer will perform before the earnings are announced.  Possibly forecasting tools and software can assist the fashion industry and the financial industry equally.

Retail Sales Forecast Resources:

Monthly and Annual Retail Trade (US Census)

NRF (National Retail Federation)

Kiplinger

Forecasts.org

You may also find the production & sales statistics information provided by the Small Business Association to be helpful.

Additional Research Guides:

Apparel Research Reports

Black Friday Sales Reports

Fashion Industry Statistics

Fashion Industry Statistics 1992 - 2014

Retail Sales Forecast Technology Resources:

SAS Retail Sales Forecast: Predict consumer response to price changes and promotional activity in order to generate a demand forecast at the store level. You can forecast demand for long- and short-lifecycle retail products by considering critical causal factors – price, promotions and marketing activity – and analyzing the effects across the whole category.  Improve forecast accuracy by analyzing consumers' response to price, promotion, marketing and operational activities and their effect on demand. Price and promotions will affect demand more than any other single factor. Most retail forecasting solutions do not consider price a causal factor when generating forecasts, but it's a core component of our solution.  Having a better understanding of demand means that it can be used as an input to the space management function in order to calculate ROS, stock holding, turns, safety stock and, therefore, required space.

Forecast Pro is a comprehensive forecasting and forecast management system. This affordable and easy-to-use solution gives your team the capability to create accurate and credible forecasts, along with the tools for efficiently managing, monitoring and improving your forecast process.

Retail Planning from Demand Solutions:  Demand Solutions Retail Planning is designed to support the concept of continuous replenishment. It makes the demand from each POS location available and empowers the account manager to intelligently analyze the data to create a replenishment order. The data can be managed and analyzed at aggregate levels while the system calculates the replenishment order at the individual store/sKU level.

If you own a fashion boutique or large clothing store, you may want to read about writing your business plan on the Small Business Association website.  And read how to calculate your startup costs.

Your sales forecast is the backbone of your business plan. People measure a business and its growth by sales, and your sales forecast sets the standard for expenses, profits and growth. The sales forecast is almost always going to be the first set of numbers you'll track for plan vs. actual use.

We hope that you agree with us that a retail sales forecast is important.  Hopefully this page helped you learn a little more about the subject.

Learn more about fashion retail software.

You may also want to know about fashion forecasting which is a bit different.

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Who Else Uses the Forecast

Outside the industry, financial institutions need future sales performance as well: a retail sales forecast matters to banks, to factors, and to stock market traders, and knowing how retailers performed last year or last quarter is only half the need — the forecast or projection for next quarter and beyond is the other half. The public data backbone comes from the Monthly and Annual Retail Trade reports of the United States Census Bureau and from the National Retail Federation, with Kiplinger and Forecasts.org among the published forecast sources and the Small Business Administration's production and sales statistics as a further resource. The research guides linked from this page — apparel research reports, the Black Friday sales reports and the fashion industry statistics collections — supply the historical actuals a forecast is built against.

Forecasting Tools and What They Add

Specialist software turns history into a demand plan. SAS Retail Sales Forecast predicts consumer response to price changes and promotional activity to generate a demand forecast at the store level, forecasting long- and short-lifecycle products by causal factors — price, promotions and marketing activity — where price and promotions affect demand more than any other single factor; the demand understanding then feeds space management, calculating rate of sale, stock holding, turns and safety stock, and therefore required space. Forecast Pro provides a forecasting and forecast management system for creating accurate, credible forecasts and managing the process. Demand Solutions Retail Planning supports continuous replenishment, making demand from each point-of-sale location available so account managers can analyze data at aggregate levels while the system calculates replenishment orders at the individual store and SKU level. For the boutique owner, the Small Business Administration's guidance on writing a business plan and calculating startup costs, linked from this page, is the entry point to the same discipline at single-store scale.