The ability to predict the future would be a practical skill to have if it were truly possible. Then again, the trucking industry has a process that actually serves that purpose. It’s called “demand forecasting,” and it’s a handy way of estimating and predicting future consumer demand for trucking services using predictive analysis of previous data. While it’s a technique that’s used in many industries, it’s of particular interest to 3PL logistics companies in Canada.
The Value of Predicting Demand For 3PL Providers In Canada
By estimating future sales and income, demand forecasting assists 3PL freight companies in making more educated levels of support. Data is definitely king in 2023, and data mining previous sales information allows those responsible for future sales to make informed decisions about all aspects of the shipping process. Without knowing if there is demand for a particular service, there can be no planning. That means no budgeting for appropriate staff levels, no budgeting for marketing, no budgeting for possible expansion of fleets. All 3PL freight companies trying to conduct strategic planning cannot accurately do so without demand forecasting. The process has to be conducted knowing that it can’t possible be precise; no one can fully predict developments domestically or internationally that may have an impact on future demand for trucking services. However, proper analysis of past and current data is an extremely purposeful activity for predicting demand for 3PL services.
The Various Types of Demand Forecasting
Companies with a wealth of previous data at their fingertips can use Passive Demand Forecasting methods to estimate future demand levels for their 3PL services. Using this historical data is a simple predictor of future demand; if market conditions remain stable, it makes sense that past demand will be reflected in future demand. Active Demand Forecasting is a better tool for 3PL providers looking for markets where they can increase demand. This is a way to consider targets for active growth and help give 3PL companies the data required to start building effective growth strategies. Short and long term demand forecasting are also useful tools to guide day-to-day demand forecasting or, in the case of long-term demand forecasting, a chance to predict season or annual trends. For companies wanting to develop a solid growth trajectory for their business long-term demand forecasting is a vital tool and a necessary process.
NATS Canada IS A 3PL That Can Guide Your Future Demand Capacity
It’s always important to consider all the external factors affecting demand on your business. If you’re operating a large fleet, working with the team at NATS Canada can help you develop a proper plan to ensure your fleet is continually active even in periods of economic downturn. From determining potential sales to forecasting adequate human resource capacity within the trucking industry. NATS Canada can help keep your transportation company rolling.