This is a classic case of estimating demand using external factors. In this case, we are looking at the weather, specifically rain, as a factor that can help us estimate demand for umbrellas in a given city. To estimate how many umbrellas are sold in a city when it rains, we need to start with some assumptions and data. Here are some key steps: 1. Define the market: We need to define the market we are interested in. For example, are we interested in the market for all types of umbrellas or just a particular type, such as compact travel umbrellas? 2. Identify the target city: We need to identify the city we are interested in. This could be a major city or a smaller town, depending on the scope of our analysis. 3. Collect historical weather data: We need to collect historical weather data for the target city. This data should include information on when it rained, how much it rained, and for how long. 4. Collect sales data: We need to collect sales data for umbrellas in the target city. This data should include information on sales volume, price, and any promotions that were running. 5. Analyze the data: We need to analyze the data to identify patterns and correlations between rain and umbrella sales. For example, we might find that umbrella sales increase by 50% on days when it rains more than 1 inch. 6. Adjust for other factors: We need to adjust our estimates for other factors that might impact umbrella sales, such as seasonality, holidays, and special events. 7. Make predictions: Based on our analysis, we can make predictions about how many umbrellas will be sold in the target city on days when it rains. These predictions can be used to inform inventory planning, marketing, and pricing decisions. Overall, this is a complex problem that requires careful analysis and data collection. However, by using external factors like weather, we can get a better understanding of demand and make more informed business decisions.
Estimation