Price sensitivity

Weather sensitivity

Weather sensitivity analysis

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Weather sensitivity analysis


In causal analysis the aim is to analyse the effect of factors which are suspected of causing shifts in sales volume or market share. Such factors might include the weather, relative prices, sales force availability or economic indices. The method used to carry out the investigation is to analyse historical data using specialist software. After carrying out an analysis of weather sensitivity it will be possible to form a more intelligent interpretation of the past and therefore make a better informed forecast of the future. 

Weather related forecasting


In the case of the weather it is particularly difficult to make a satisfactory weather forecast as the input to making a sales forecast. However, a weather sensitivity analysis can still improve the forecast through a better interpretation of the past. For example if there has just been an extreme hot spell and we are in the business of selling ice cream, sales will undoubtedly have surged through the hot weather. If we have quantified the effect of that hot weather, we can avoid ramping up the future forecast erroneously. So it may be useful to 'deweatherise' the history before feeding it into the sales forecasting system

Click here for a case study on weather sensitivity / weather related forecasting.

Need for expert help


Specialist software is invaluable in carrying out causal modelling such as weather sensitivity, but great care is necessary to avoid confusion of the results with natural seasonality or inherent trends in market size or share. The matter should not be left to an automatic process embedded in software.

Forecast Solutions can expertly carry out the work and help maximise the benefits in terms of integration into an improved sales forecasting process.

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