Car Sales Forecast and Financial Strategy

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Car Sales Forecast and Financial Strategy

Apart from identifying the interest rate charged for a loan, one will have to consider a variety of factors in order to predict sales rates efficiently. The forecast of sales rates is quite hard to carry out due to a variety of factors affecting it. These factors can be split into two large groups, the first one incorporating the external ones (e.g., such as the current state of the economy in the specified state, the buyers power, including the financial capacities thereof, buyers earnings, etc.). The second group includes a range if internal factors, i.e., the ones that the company in question is capable of shaping. For instance, the firms annual net income, its financial strategy, the resources management, the marketing tools used by the organization, etc., deserve to be mentioned among the essential ones. Hence, the interest rates of an organization are a crucial part of the financial strategy definition, yet it is only one of the many items that need to be taken into account prior to carrying out any transactions (Pride & Ferrell, 2014).

As it has been stressed above, the change in the interest rate for a loan, though clearly being an important factor in defining the future financial strategy for selling products, such as cars, is to the only factor that defines the price for the product in question. Apart from the factor in question, the parameter such as the current financial index, need to be taken into consideration when redefining the interest rate.

The regression analysis also provides rather high objectivity rates. Consequently, the precision of the model increases considerably compared to other forecasting tools. It is also essential that the specified model allows for an incorporation of both the factors that the firm can change and the ones that are not dependent on the companys actions.

The forecasting model in question can be viewed as the most adequate tool to adopt in the specified scenario as it allows identifying the chances for the organization to succeed without taking any significant losses. Moreover, the tool under analysis can be viewed as the means of identifying the existing patterns of action and choosing the one that presupposes that the organization should incur minimum losses. In other words, the designated tool allows for a careful calculation of the interest rates and the possible expenses that the organization may need to take, including the ones that are inflicted on the firm by the economic circumstances and the ones that have been caused by other factors (Webster, 2013).

Despite the fact that the 7% car sales index cannot be described as stellar opportunities for the industry development, it would be wrong to claim that the specified rates point to the inevitable decline of retail. Instead, it should be viewed as a significant drop in the current sales and the manifestation of the need to transfer to a different strategy in the designated business area. The tools for galvanizing the industry and boosting the sales have to be introduced in the realm of car retail so that new opportunities could be created. As soon as innovative tools for marketing the product in question to the target audience are designed and incorporated into the companies strategies, a major boost of car sales rates can be expected.

Reference List

Pride, W. M., & Ferrell, O. C. (2014). Marketing 2014. Stamford, Connecticut: Cengage Learning.

Webster, A. (2013). Introductory regression analysis: With computer application for business and economics. New York City, New York: Routledge.

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