BY :

DEMAND FORECASTINGFOR

RAJ COSMETICS

MANDEEP rawatMANICA TEWATIAMANISH khuranaMEHAK SAGGAR

WHAT IS DEMAND FORECASTING?

UNDERSTANDING THE ECONOMYROORKEE

Current population = 40 lakh

HINDU

MUSLIMS

OTHER

32 lakh

6 lakh

2 lakh

Literacy rate 70% Literacy rate 60%Life expectancy is 65 yearsIncome growth 8%Population growth rate 1.5%

No inflation

Trading 20 lakh

Manufacturing 10 lakhAgriculture 6 lakh

PURPOSE OF DEMAND ESTIMATION

Appropriate production scheduling.

Reducing costs of purchasing raw materials.

Determining appropriate price policy

Setting sales targets and establishing controls and incentives.

Planning of a new unit or expansion of an existing unit.

Planning long term financial requirements.

Planning man-power requirements.

FORECASTING DEMAND FOR OUR HERBAL SHAMPOO

Project the demand for a new product as an outgrowth of an existing old product.

Analyse the new product as a substitute .

Estimate the rate of growth and the ultimate level of demand .

Estimate the demand by making direct enquiries from the ultimate purchasers

Survey consumers’ reactions to a new product.

ASSUMPTIONSEstimation of population is 43 lakhs after 5 years.Division of population is done on the basis of following parameters:

Religion: hindu 34.4 lakhs Muslims 8.6 lakhs Food habits: veg 13.76 lakhs veg and non-veg 20.64 lakhs non veg 8.6 lakhs

Sex ratio: male female jainism 7,56,800 6,19,200 Other 15,20,480 14,03,520

Economic Activity: Agriculture 6,45,000

Age group : children + above 60 = 10,32,000 43,00,000 – 10,32,000 – 6,45,000 = 26,23,000

Income group , religion and Sex ratio :Total Jainism male female 3,92,400 3,21,054 (excluding low income group)

Total Hindu 1,63,675 1,51,085 Muslim 68,198 62,702

About 40% upper middle income group people and 10% high income group people will shift towards RAJ COSMETICS .

Conclusion:

Total Male Consumers = 805132 Total Females consumers = 701789

After 4 – 5 years the total demand will be 805132 + 3 (701789 )

= 2910500 bottles .

METHODS FOR FORECASTING

TEST MARKETING

We don’t use shampoos…hair becomes weak.

CUSTOMER SPEAK

I use EGG-BASED. It make hair soft. But I would like to try HERBAL as well and its cheaper also….

I don’t use shampoos, they are for girls.

BAZAR INSIGHTS

Most of the women purchase shampoo sachets from weekly markets/near by towns.

Myths such as shampoos lead to higher hair fall/weaker hair were also found in respondents.

Shampoos were perceived to be as women usage product.

BENEFITS OF OUR FORECASTING

Improve predictability of customer and product behaviour.

Respond to dynamic demand in real time.

Improve demand planning efficiency.

Capture market and Earn Long term profits.