Determination of the sales forecasting methods used by sugar manufacturing firms in Kenya

Abstract

This survey study was carried out amongst the seven sugar manufacturing companies in Kenya operating at the time of the study and licensed by the Kenya Sugar Board. The objectives of the study were: - to determine Sales forecasting methods used by sugar manufacturing firms in Kenya, to identify factors that influence the choice of the methods, and to determine challenges encountered in the generation and implementation of the sales forecast by sugar manufacturing firms. The study established that the sugar firms use sales forecasting to set their targets and for performance evaluation. The firms use qualitative models of market research to forecast their sales locking out the use time series analysis and casual methods. The use of the qualitative models (market research) within the sugar industry is attributed to the model's reliability, ease of interpretation ofresults and flexibility in use. Finally, it was established that sales forecasting models face several challenges the main ones being lack of reliable/relevant data, lack of organizational support, and absence of consultancy services in the area of sales forecasting.