Sales forecasting methods used in large fast moving consumer goods manufacturing firms operating in Kenya

Abstract

One challenge that manufacturing firms in Kenya face today, is the development and implementation of a reliable sales forecasting process, in the advent of constantly changing consumer demands. Sales forecasting in a large manufacturing operation, ought to be a dependable process which will deliver an effective response to a wide range of consumer demand patterns. For the FMCG category of goods, a sale on time is critical due to the perishable nature of the products. Sales forecasting methods that would give highest degrees of accuracy are essential. This study investigated current practices of forecasting sales in the FMCG manufacturing firms. The specific objectives of the study were to fmd out the most commonly used sales forecasting methods, to establish the reasons behind the currently practiced sales forecasting methods, to determine the challenges encountered in the process of generating a sales forecast and to determine the level of familiarity of existing sales forecasting method. It aimed at giving a comparison between the theoretically known sales forecasting methods and the practically used methods by the FMCG manufacturing firms. The study used primary data collected from 48 FMCG firms that formed the population of interest. The required data was collected using a semi-structured questionnaire having both open-ended and close-ended questions. The mode of collection was personal interviews and "drop and pick later" method. The data was analyzed using descriptive statistics and presented using frequency tables and percentages...............................................