Service Management, Student Workbook: An Integrated Approach to Supply Chain Management and Operations

15. Forecasting Demand for Services

15.8. Summary of the Chapter

Forecasting demand for services is important in most services because fluctuations in demand cannot usually be taken care of by building inventory. When the service is “embedded” in a physical product, forecasting and meeting demand fluctuations are analogous to the manufacturing situation. In either case, the demand forecast is the basis for all planning.

In manufacturing, demand is forecasted in terms of units of physical product. In services, it is not always clear what to forecast and what can be forecasted. That is, the outputs of some service firms are of almost infinite variety. Basically, however, service demand is in terms of (1) number of customers and (2) number of ...