One of the most overlooked elements of sales forecasting involves the omission of a secondary trade area which lies just past the primary trade area. Even when a secondary trade area is delineated it is often treated as one singular geographic area. There is a better way…
SPR has a patented technique that forms BandQuads. The BandQuad system has the advantage of disaggregation (individual sub-units of geography) that allow the forecasting model to discretely examine varying conditions across the secondary trade area. There can be up to 8 BandQuad sectors allowing for more precision in sales estimation.
We have found that BandQuad secondary trade areas generally account for 10% to 35% of total store sales. If this element is omitted or given less scrutiny the accuracy of the entire sales forecasting system is substantially reduced.
The illustrations below show the formation of BandQuads.
