ABSTRACT
Section 2.2.4 in Chapter 2 demonstrated how in order to drive by looking through the windscreen rather than the rear view mirror a view of the future incorporating sales forecasts or advance customer orders is needed. For special orders, for example large capital items such as turbines for power stations, armaments such as tanks and aircraft, and some government tenders, the customer is prepared to wait whilst all the raw materials and components are purchased and the product assembled, but for most companies this represents the exception rather than the rule. Consumer goods in particular are usually required off-the-shelf. In order to provide this sort of service, some advance forecast of sales is necessary. Figure 8.1, which is a copy of Fig. 1.3 shows how the need for sales forecasting depends on the type of service offered. Everything to the left of the point at which the customer's order is received and the customer's lead time commences needs to be initiated by some form of sales forecast.
