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Running head: ORGANIZATIONAL ECONOMICS 1

ORGANIZATIONAL ECONOMICS 2

Product Forecasting

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Product forecasting

Product forecasting is the process of predicting the nature of the market and the degree of success of a given product. It is essential to take into account the competitors to make the forecasting a success (Hyndman & Athanasopoulos, 2018), the pricing of the product, and awareness and various needs of the customers.

Depending on the various factors such as taste and preferences of the consumers, price of production, and distribution, a product can either succeed in the market causing high demand or decline, resulting to less demand. As a result, forecasting made to succeed or becomes unsuccessful. For instance, with the advanced technology, Apple made it into the market by introducing the first touchscreen smartphones that had numerous purposes. This led to more demands by users, the company, therefore, making huge sales, and thus the profits (Gentry, 2015). The company usually predict their products by calculating the expected demand, for instance, taking the figures of the previous sales. Then, they decide on where there may be a current recession that is going on, and whether their current gadgets are dwindling.

The Shopify is the most demanded online platform service having numerous stores and millions of users. It allows the selling of goods and services online wherever one is. It also provides billing and money collection online, making it more convenient.

For the newly introduced products in the markets that faced rejection, Chrysler Automobiles is a victim. Their products failed being ordered by their dealers accumulating more and more. The reasons may be due to the introduction of new data-driven strategies of production, which would lead to inventory swelling. This led to staff working on overtime to press the dealers. The old systems that were used in streamlining manufacturing, in the forecast demand process (Dias & Duzert, 2016). Moreover, the employees expressed frustration on the products saying that they did not match the market preferences. The challenges that are faced by the carmakers include the adoption of new technology in overhauling safe practices.

The United airlines faced an ignorance of their services when they mistreated one of their customers. This was after security guards had caused injuries to a doctor, in the process of removing him from a flight. The upsetting event led to many customers declining their services, leading to a considerable loss of the company.

Product forecasting is an essential process in knowing how a product will enjoy on its marketplace. Before introducing any product to the market, the companies and dealers should understand their competitors taste of their customers. As a result, it will help keep them ahead of the competition and make huge profits.

References

Dias, M., & Duzert, Y. (2016). Fiat Chrysler Automobiles in Brazil: Alliance Consolidated. The International Journal of Business & Management, 4(2), 160.

Gentry, K. (2015). Apple picking: The rise of electronic device thefts in Boston subways. Safety and security in transit environments (pp. 39-55). Palgrave Macmillan, London.

Hyndman, R. J., & Athanasopoulos, G. (2018). Forecasting: principles and practice. OTexts.