Forecasting is the process to predict how the future needs, which include the requirement in the size of the quantity, quality, time and location that is required in order to meet the demand for goods or services.
Demand Forecasting is the demand for products that are expected to be realized for a certain period in the future. In forecasting we must pay attention to forecasting procedures should be implemented, namely :
1. Determining the purpose of forecasting.
2. Choose the item “independent demand” to be predicted. Plot data into scatter diagram.
3. Selecting “forecasting method” in accordance with the pattern of data for its intended purpose.
4. Counting errors are to be performance of each method used, can be known.
5. The selection of the best method, which has the smallest error rate.
6. Make predictions of future demand, then perform the test verifies that the forecasting results carried out a representative to the past data.