A planning model to forecast market demand for two lines of durable products

摘要

This paper describes a planning model which forecasts annual domestic market demand by end use for a Westinghouse division manufacturing two lines of durable goods. This model takes an unusual approach in solving the problems that arise in analyzing any mature market: it combines traditional econometric techniques with a structured theory of the market. The structured approach was used where data such as saturation or replacement rates was available. The adequacy of the structured portions was determined by historical industry data and the division's marketing experience. Where appropriate inputs for the structured model could not be found, traditional econometric techniques were employed. This combination of approaches allows the model to reflect the overall market structure, market maturity, economic influences, and division insights. A computer program has been written to allow periodic updates and easy simulation of alternative economic scenarios for planning purposes.