Forecasting and the Order Bank
Forecasting is a structured bet on the season ahead, placed months before customers show up, against allocation and floor plan. Because equipment is ordered ahead against allocation, it’s a decision with real money and floor-plan risk attached — not a back-office guess.
What feeds it
The honest pipeline (the closest read on near-term demand, only as good as the salespeople’s CRM honesty), sales history, the seasonal calendar (demand peaks around planting and harvest, so the order bank has to have units in the pipeline before those windows), and the commodity and farm-income outlook (a strong-price year loosens wallets, a soft year tightens them no matter how good the effort).
Order ahead, and the cost of getting it wrong
The order bank is the machines ordered but not yet received; managing it well means ordering ahead so units arrive in time and so you secure allocation before the hot machine’s spoken for. Get it wrong both directions and it costs: too low and you’re empty when the season hits, losing sales you can’t recover on short notice; too high and you’re overstocked as demand softens, carrying aging stock that bleeds floor plan. And the honest pipeline every salesperson maintains is the input the whole bet depends on — inflated pipelines over-order, hidden ones under-order.
Where it goes wrong
- Treating forecasting as irrelevant to selling.
- Corrupting the forecast with an inflated or hidden pipeline.
- Failing to order ahead and getting caught empty on allocated machines.
- Over-ordering into a softening market.
Related
Whole-goods inventory · Using a CRM · How dealers and manufacturers work together · Understanding the farmer’s business.