Forecasting System Constraints:

The constraints imposed on the forecasting system greatly affect the selection of the forecasting method and the value of the forecasts prepared. Some significant constraints are following:

1. The time available to prepare forecast

2. The expertise within the organization

3. The available computing facilities

4. The lack of availability of relevant data from internal and/or external sources

5. The quality of available data

The constraints 1, 4 and 5 may seriously affect the quality of the forecast, while the effects of constraints 2 and 3 may be neutralized by increasing the budget allocation to the forecasting system.