195Distribution and Retailing
A company must modify their base forecast to include other factors. First, they must
schedule their own planned events, such as promotions or advertising campaigns. Failing
to have the necessary inventory on hand for a major promotion is a sure way to alienate
customers. Next, the company must include any new formal contracts or agreements that
did not previously exist in the forecast. Finally, they must consider the effect of external
forces on demand. Is the economy better or worse than the last period? Will the new gov-
ernment’s tax law increase or decrease spending? Has the customer base moved toward
or away from buying their goods? For example, furniture businesses are nding that
customers are buying more ...