Management is continually faced with fast-paced flow of business planning and decision-making situations. A forecast of some type is used as a basis to meet many of these needs, whereby, the more reliable the forecasts, the better the outcome for the planning and decisions.
A demand forecasting is a firm’s best estimate of what demand will be on the future given a set of assumptions.
According to American Marketing Association, demand forecasting is an estimate of sales in dollars or physical units for a specified future under a proposed marketing plan.
The definition of demand forecasting can also be made more relevant by contrasting the process of demand forecasting with two other business activities: business planning and goal setting.
It is a useful tool that can provide a variety of stakeholders for example airport and airline owner, potential inventors and the government - with useful insight into the potential future developments relating to both airports and airlines.