By using previous data as the primary input to ascertain the direction of future trends, forecasting is a technique for making educated predictions. Forecasting is used by businesses for a variety of tasks, including estimating future costs and allocating their budget. Either primary sources or secondary sources might provide the data required in forecasting techniques.
Primary Sources
Primary sources offer first-hand data that has been directly gathered by the individual or group conducting the forecasting. Although it is difficult to acquire and organise all the information, it is typically obtained directly through a variety of questionnaires, focus groups, or interviews, making primary sources the most reliable ones.
Secondary Sources
Secondary sources offer data that has already been compiled and processed by an outside entity. The forecasting process goes more quickly when the data are collected and arranged.
