What is the difference between qualitative and quantitative methods of forecasting?

Question

Shahbaz Hayder · Answer

Quantitative method of forecasting uses numerical facts and historical data to predict upcoming events. The two main types of quantitative forecasting used by business analysts are the explanatory method that attempts to correlate two or more variables and the time series method that uses past trends to make forecasts.

Qualitative method of forecasting is often employed where the key trends or developments are hard to capture or where such data is not available. In such a case business analysts used subjective information such as intuition or informed opinion for forecasting the future results. This type of forecast is essential for new products where no historical information is available and primarily used for medium & long term planning. Qualitative techniques include the use of information gathered from Expert opinion, Market research, Focus groups, Historical analogy, Delphi method and Panel consensus.

Abdul Khalique · Answer

Quantitative Method of Forecasting often use historical data, such as previous sales and revenue figures, production and financial reports and website traffic statistics. Looking at seasonal sales data, for example, can help a company plan next year’s production and labour needs based on last year’s monthly or quarterly figures. Quantitative forecasting also uses projections based on statistical modelling, trend analysis or other information from expert sources such as government agencies, trade associations and academic institutions.

Qualitative Method of Forecasting come from the experience and instincts of seasoned business experts. These forecasting techniques are not just guesses; they include interpretation of data combined with professional expertise developed during years on the job. For example, a company wanting qualitative information for projecting sales for the year might estimate the impact of a new ad campaign or promotion the company is planning, look at the effects that new technologies might have on consumer purchasing and take into account recent social fads and trends. A business might forecast demand by holding focus groups of customers to discuss and gauge their reactions to several new product features the company is considering.

Tamer Elbeshbishy · Answer

Agree. However, Both of them are important .!!

dalal alharbi · Answer

Thanks for the invite I leave the answer to experts specialists

HASSAN AHMED · Answer

As Mr. Shahbaz has defined very well

Mohammad Iqbal Abubaker · Answer

Answer added by: Shahbaz Hayder Chief Financial Officer IS THE CORRECT ANSWER.

Ali Mohammed · Answer

Thanks for the invitation

Quantitative methods rely on forecasting Basically on the quantity or numerical data and the use of various statistical methods to analyze these data and realize the objectives of forecasting .. The qualitative methods are Basically based on personal referee and experience in the various information on the topic of forecasting analysis

With my best wishes to you

Zehab Osman · Answer

Agree with shahbaz hayder detail answer.

Mohamed matar · Answer

thanks for the invitation

Consistent with what the answers

Ghada Eweda · Answer

A good answers given by the professionals. Thank you

حسين محمد ياسين · Answer

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What is the difference between qualitative and quantitative methods of forecasting?

A good answers given by the professionals. Thank you

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