How Business Forecasting Software Can Save Companies Time and Money

Business Forecasting Software July 26, 2020

Jin Hyun

Writer

Business forecasting software can help companies become more agile and ultimately make better data-driven decisions. It can offer extraordinary benefits by streamlining the budget planning and forecasting processes so owners and managers can get back to focusing on doing what matters the most running their business smoothly and creating better experiences for the customers.

Automating the process of predictive analytics can save an establishment both time and money by producing an accurate forecast at the click of a button. Forecasting software has the capability to instantly pull a company's historical data and all relevant information into one simple report without the need for manual data collection, calculations or spreadsheet manipulation.

Benefits of Effective Forecasting

Business forecasting is a technique of predicting the prospective financial circumstances of an organization based on its past sales and present situation, such as the company's cash flows, financial data, as well as market trends.

Benefits include-

Improved reporting - For example, a business can run what if scenarios and monitor their key metrics via precise forecasting reports.

Better inventory planning - Forecasting can help paint a clearer picture of the company's supply chain so businesses can better assess the level of customer demand. From here, they can order the optimal amount of inventory to successfully fulfill orders without excess waste or shortages.

Efficient workforce planning - By anticipating the correct level of demand, businesses can also effectively budget and plan for labor. By hiring and scheduling only the amount of employees needed per shift, productivity will increase.

Informed decision-making - Forecasting eliminates the need for eleventh-hour guesswork, improving the accuracy of the decision-making process by basing it on historical data and market trends.

Cost reduction - By utilizing the data from an accurate demand forecast, businesses can optimize their budget planning simultaneously. They will be able to clearly see where budgets can be minimized and plan accordingly.

Why Choose Automation?

Managers or owners of businesses likely understand the challenges of tracking sales, inventory, and labor forecasts on an excel document. Manually carrying out these tasks can be complicated as there are too many internal and external factors to take into consideration.

Internal factors could include the hiring or replacing of employees, while external factors could include unexpected changes in the economy or market trends.

Using forecasting software can produce more in-depth projections quickly and easily by streamlining operations, therefore freeing up more time to prioritize other tasks within the business.

Here are the 3 key benefits of automation-

1. Improved business operations

Automated forecasting offers better control and management of the forecasting process. This would also save managers and owners time as they don't need to manually plan and forecast by entering data into spreadsheets, increasing workplace efficiency.

2. Improved customer satisfaction

In most industries, customer satisfaction is based upon accuracy and promptness of delivery. By automating the forecasting process, businesses can holistically refine, streamline, and enhance operational functions, logistics, and production cycles.

In doing so, they can ensure their workforce planning and inventory levels always match the expected demand, therefore improving consumer retention and satisfaction.

3. Better compliance

Via regulatory reporting, forecasting helps businesses identify incongruities quickly so they are compliance-ready 24/7.

New laws and regulations, as well as other changes in the industry, can be difficult to keep up with, however, forecasting software will automatically recognize any discrepancies and notify the users.

Key Features in Forecasting Software

With a plethora of software available on the market, how can businesses choose the best option for their unique needs?

Here are key features to prioritize when shopping around for business forecasting software-

Integration - For businesses that choose to implement cloud-based forecasting software, they can even seamlessly integrate their predictive analytics with their POS systems to eliminate any need for data entry. This means sales data from the POS system is instantly uploaded onto the forecasting software to produce the most up-to-date and accurate demand forecast possible.

Tailored forecasts - Business forecasting software should allow for adjustments in projections based on seasonality such as weather and events. For example, businesses should be able to tailor forecasts in case they are expecting an increase in demand due to a large local event. Similarly, they should be able to adjust forecasts if they are anticipating fewer sales due to bad weather. While relying on historical data can be helpful, the software should be ready to account for any sudden changes.

Ease of use - Having a user-friendly interface is essential so that even the most non-technical managers can make the best use of the program.

Robust reporting and analytics - The software should also enable managers to perform queries and create financial and management reports autonomously without help from IT specialists.

It's no secret that forecasting is an essential aspect of running an optimal and profitable business. However, it's about how a business chooses to plan and forecast that can put them ahead of the competition.

Automated forecasting allows managers and owners to optimize their business budgeting and revenue planning by making informed decisions regarding future demand. Companies both large and small can take advantage of automated software which assists in creating accurate budgets quickly and easily while eliminating human errors. This, in turn, helps to boost reputation and improve cash management.