Measuring and Forecasting Demand - Tourism: Principles, Practices, Philosophies - page 291

Projecting restaurant sales was an easy task until the great recession of 2008 - 2009 caused sales to
decline after 16 years of steady increases. Such changes make forecasting more dif cult, but trend
analysis is still a useful tool for making projections. Tourists enjoy food in many settings. Here, tourists
are dining in the lovely Golf Club restaurant with excellent food and views. PhotocourtesyofTheBroadmoor.

A linear trend in demand levels can then be determined (say, line AB). If a demand projection for
year 10 were needed, the trend line AB can be extended to a point such as C. Finally, the projected
demand level in year 10 can be determined to be approximately 180,000 arrivals, as shown in
Figure 13.1.
The advantage of using trend analysis is that the data needed are rather basic and easy to obtain.
Only one data series is required: visitor arrivals, or some other measure of demand on a quarterly or on
an annual basis for the past few years. In addition, the method is simple and does not require a great
deal of mathematical sophistication. Characteristically, however, the simplicity of the model is to a
large extent a trade-off for the usefulness of the results. For instance, the future demand estimates
obtained in this manner should be interpreted with a great deal of caution. There are several reasons

300

250

C

200

180

150

B

100

A

50

0

1 2 3 4 5 6 7 8 9 0

Time (years)

Figure 13.1 Trend analysis.