Advantages and Disadvantages of Qualitative forecasting techniques.

 Advantages and Disadvantages of 
Qualitative forecasting techniques.

There are two Types of Forecasts, Qualitative & Quantitative. Qualitative includes Executive opinions, Sales force opinions, Consumer surveys and Delphi techniques whereas, and quantitative includes Regression & Correlation and Time series.
Jury of Executive Opinion
This is for long range planning like new product development, long-term strategies. Here factors are hard to quantify. In this technique pool opinions of high level executives is taken and forecasting is done.
Advantages
• It is Easy & rapid
• There is no need of mathematical calculation.
• We can get opinions, knowledge and talents from all over the firm.
• This technique is usually low-cost.
Disadvantages
• It is opinion based so may not be dependable.
• The view of one person which may not have relatively good result may prevail others.
• Tough to breakdown to areas
• Tough to breakdown down for tasks
• Conflict may arise during decision
Sales force opinions
 This is actually based on direct customer contact. The retailer mainly forecasts for the manufacturer. The information for forecasting is usually received from Members of the sales staff or the customer service staff.
Advantages
• It puts forecasting responsibility in those hands that can make it happen.
• Salespeople know the actual sales potential in their areas
• Statistical and technical errors are minimized
• Comprehensive ultimate forecast is done by product, customer, and market
• It can be done with little or no data or history.
Disadvantages
• Salespeople are not trained for forecasting.
• Salespeople focus on the present. They do not antedate environmental change
• They may be unable to distinguish between what the customers would like to do and what they actually will do
• They are sometimes overly predisposed by current involvements
• The salespeople may not be that interested.
Customer surveys
In this technique, sample or census of consumers expresses their buying intentions. They determine the demand for future. Then responses are added and applied to the market for a forecast. It is assumed that customers have the ability to predict in advance.
Advantages
• Forecasting is done by Real consumers.
• This method is fast, inexpensive & easy if there are little buyers.
Disadvantages
• Consumers don't have idea of doing it. Because significant knowledge and skill is required to conduct a survey, administer it, and interpret the results for valid information.
• Customers may not keep information confidential.

• Surveys are expensive, time consuming