In most large-scale service industry properties, tremendous effort is devoted to anticipating guest or customer volume, as well meeting their needs. Managers accomplish this by providing and using available resources. In most cases, the key piece of information is volume. The essential purpose of a forecast is to develop volume projections and then determine the level of demand the anticipated volume creates.
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Forecasts are based on the KBIs (Key Business Indicators) that have been established for the property and how they are set up in the system. Typically, the majority of KBIs in LMS fall under two major classifications: revenue centers or market segments. Revenue centers are created to configure KBI forecasting methodologies and to be able to edit those forecasts. Market segments are designed to go with Rooms forecasting. There are also some special forecasting circumstances.
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The key to creating an accurate forecast is to obtain necessary data on a regular and timely basis for input into LMS. To gain the maximum benefit from the software and to ensure that it stays current, booked room counts must be entered prior to generating a room forecast, and actual volume counts must be entered each day. Failure to acquire necessary data or incorrectly entered data will result in inaccurate forecasts and plans. Since there is a natural tendency to accept numbers on paper as valid, it is extremely important that all numbers are carefully recorded and verified. When used properly, LMS is an effective and valuable management tool that lets management automatically produce accurate forecasts without maintaining myriad paper records.