Sales forecasting strategies for small businesses: an empirical investigation of statistical and judgemental methods

Abstract

This study evolved from the mixed results shown in the reviewed forecasting literature and from the lack of sufficient forecasting research dealing with micro data. The main purpose of this study is to investigate and compare the accuracy of different quantitative and qualitative forecasting techniques, and to recommend a forecasting strategy for small businesses. Emphasis is placed on the testing of combining as a tool to improve forecasting accuracy. Of particular interest is whether combining time series and judgemental forecasts provides more accurate results than individual methods. A case study of a small business was used for this purpose to assess the accuracy and applicability of combining forecasts. The evidence indicates that combining qualitative and quantitative methods results in better and improved forecasts.