Sales Forecasting

TMM has over fifteen years experience in forecasting sales for retailers, and developers. When forecasting sales, TMM would typically employ the following (or similar) methodology:

1. Gather Data for Proposed Site and Market. TMM would gather data on the proposed store location and market, including precise site location (latitude/longitude), sister stores, and competitors' locations.

2. Define Trade Area. We would define a trade area for the potential store based on sister store locations, competition, access patterns, physical and psychological barriers, our expertise, any prior knowledge of the market, and the knowledge gained from the database. This can be completed on an in-office basis but for the best accuracy, detailed fieldwork is required.

3. Develop Trade Area Population, Demographic, and Business Characteristics. For the defined trade area, TMM would estimate and project population, selected demographic characteristics, and employment data. The specific characteristics would include, at a minimum, the variables determined to be important from the correlation analysis and which are inputs to the forecasting models.

4. Forecast Sales. We would forecast sales for potential locations using a combination of the forecasting models. This could include normal curves, regression models, and the analog database. TMM, Inc. would use its experience and judgement in its final sales forecast, i.e. how the various forecasts resulting from the several models are integrated and the final forecast derived. Transfer sales ranges or cannibalization from existing stores would also be estimated for in-fill locations, in order to estimate incremental sales gain ranges.