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Quantitative Analysis of Sales Forecasts

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Please don't forget to define the X and Y variables; use regression formulation to get stats; compile scatter plot graph including the equation and r(square) option;project sales for next year (quarterly); separate regression for Putnam and Sanford changing the variables that needs to be changed.

Hayes Pump, LLC is a multi-line distributor of industrial pumps and fluid management equipment.They have been continuously been operating in the New England/New Jersey region since 1898. The company is owned by a small group of people, some f whom are management employees in the company and some of whom are private investors.

The company employs 24 sales executives, each of whom has control over an exclusive sales territory within Hayes' geographic distribution are. Thomas Dever, Hayes' CFO has maintained detailed records of sales volume be territory as well as by season. He has always believed that Hayes' business is seasonal and that one of the key success factors for Hayes has been the experience of its sales force.

You have been brought in as an intern to Mr. Dever in order to assist him with some quantitative analysis in order to help prepare next year's sales forecast for the company as a while and for each sales territory. Mr. Dever has provided you with two sets of data. The first piece of data is a summary profile of each sales executive's territory including information about botth the territory and the sales executive.

Mr. Dever has asked you to conduct all of the quantitative analysis necessary for the projection of next year's sales, seasonally adjusted by quarter. He is also interested in testing his belief that the experience of the sales force is an important factor in the success of the company by performing a regression analysis on that data.

The other requirements of this internship consist of trying to develop a more sophisticated and potentially more accurate model for predicting each sales executive's sales volume by using more data that just the experience of the sales executive. You must also produce sample quarterly sales projections and their 95% prediction intervals for next year for two of the sales executives; Sanford and Putnam. In projecting their sales for 2006, please keep the following facts in mind:

Sanford: Will have an additional year of experience, Number of accounts to increase 3%, NO OTHER CHANGES.

Putnam: Will have an additional year of experience, Number of accounts to drop by 2% and territory to increase in size by 10%. It is expected that 14% of Putnam's sales will be concentrated in his top 20 accounts in 2006.

Your report to Mr. Dever should take the form of a 1 page typewritten business memo with up to 4 pages of supporting documentation. Your analysis should be well-written and concise, with clear references to your supporting analysis.

See attached for data.

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Solution Summary

Word and Excel documents to show the formula/calculations and report in the form of a memo on sales forecasts.

See Also This Related BrainMass Solution

Quantitative Analysis: Forecasting Techniques

Develop a sales volume forecast using the least squares method *and* one other forecasting method.

One forecast method must be using the least squares method, the second can use any other normal forecasting method.

Provide the two sales volume forecasts in excel format, each with data shown and a graph.

Smoothing constant for average 0.3 Smoothing constant for trend 0.4

Quarter Sales

3Q 2008 90,000
4Q 2008 95,000
1Q 2009 98,000
2Q 2009 96,000
3Q 2009 102,000
4Q 2009 99,000
1Q 2010 118,000
2Q 2010 109,000
3Q 2010 124,000.

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