Certified Supply Chain Professional (CSCP) Practice Exam

When can qualitative forecasts be particularly useful?

1. When historical data is readily available

2. When historical data is not available, such as for new products

3. When mathematics is required for analysis

4. When predicting long-term market trends

The correct answer is: When historical data is not available, such as for new products

Qualitative forecasts are especially useful in situations where historical data is not available, such as for new products. In these cases, there isn't enough historical information to rely on quantitative methods, which typically analyze past performance to predict future outcomes. Instead, qualitative forecasting draws upon the insights of experts, market research, customer input, and intuition to make predictions. This approach can effectively capture the uncertainties and dynamics present in emerging markets or innovative products where previous patterns do not exist. While historical data can significantly enhance the accuracy of forecasts, it does not apply in scenarios involving new product launches or significant market changes. Therefore, qualitative techniques become essential for gathering relevant perspectives and crafting a forecast under uncertainty.