What are the advantages of Forecasting?

The following are some of the advantages of forecasting:

(i)  Forecasting plays an important role in planning. In fact, plans are based on forecasts.

(ii)  Forecasting helps the organisation to derive the benefits from the environmental changes (when the changes are favourable to the enterprise) and protect from the adverse effects (when the changes are unfavourable).

(iii)  Forecasting helps the manager to unify and coordinate the activities in the enterprise. Accurate sales forecast is almost impossible in the absence of general business forecasting.

(iv)  Forecasting facilitates control by identifying the weak spots in the organisation. When once these weak spots are identified. It becomes easy for the managers to establish sign posts for effective control and sound planning thereafter.

(v)  Forecasting helps the enterprise in the achievement of objectives effectively and smoothly.