Year 1	Year 2	Year 3	Year 4	Year 5
Method 1:
Number of American with BMI between 25 and 30	78200000	78200000	78200000	78200000	78200000
x 35% actively trying to lose weight	27370000	27370000	27370000	27370000	27370000
x15% who are comfortable using diet pills	4105500	4105500	4105500	4105500	4105500
10% who might purchase Metabocil in Year 1 with 5% increase every year	410550	615825	821100	1026375	1231650
Add: 60% who will buy second package	246330	369495	492660	615825	738990
Add: 20% who will buy a third package	49266	73899	98532	123165	147798
Total Sales	706146	1059219	1412292	41765365	2118438

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	Year 1	Year 2	Year 3	Year 4	Year 5
Method 2:
Number of American with BMI between 25 and 30	78200000	78200000	78200000	78200000	78200000
x 12% immediately ready to go to health care provider	9384000	9384000	9384000	9384000	9384000
10% who might purchase Metabical in Year 1 with 5% increase every year	938400	1407600	1876800	2346000	2815200
Add: 60% who will buy second package	563040	844560	1126080	1407600	1689120
Add: 20% who will buy a third package	112608	168912	225216	281520	337824
Total Sales	1614048	2421072	3228096	4035120	4842144

	Year 1	Year 2	Year 3	Year 4	Year 5
Method 3:
Ideal Target Consumers (Educated Females 35-65 of age with BMIs between 25 and 30	4300000	4300000	4300000	4300000	4300000
30% of Ideal target market in first year with 5% increase each year	1290000	1505000	1720000	1935000	2150000
Add: 60% who will buy second package	774000	903000	1032000	1161000	1290000
Add: 20% who will buy a third package	154800	180600	206400	232200	258000
Total Sales	2218800	2588600	2958400	3328200	3698000

What are the pros and cons of the forecasting methods presented by Printup?

If you had to estimate demand for this product, how would you go about it? What would your demand (unit) forecast look like for the first five years? 

Considering the whole population of the United States, it targets a population that is ready to begin using the product upon approval and use which makes data more precise.

Both Long and Printup were confident that sales of Metabical would quickly take off once health care providers and overweight individuals understood the value proposition of the new drug. Long expected Printup to use her experiences with past drug launches, together with the marketing research CSP had commissioned, to provide guidance on the expected unit volumes for Metabical in its first five years. Printup decided to project demand using three different approaches that were based on varying assumptions about how potential customers would respond to Metabical. Her first approach forecasted demand by looking at the number of overweight individuals in the United States (BMI between 25 and 30) and narrowing down that population to those who were actively trying to lose weight (35%, according to the CSP study). She felt this pool of potential users should again be narrowed to the 15% of those who were comfortable with weight-loss drugs. Printup's experiences taught her that Metabical was likely to capture 10% of those individuals in the first year, and in subsequent years she could expect an additional 5%, up to 30% by the fifth year. In addition, test trials suggested that 60% of the first-time users would repurchase a second supply and 20% of these would finish out the entire Metabical program by repurchasing the remaining supply. Printup also developed a more aggressive forecast using the results from the CSP survey that specifically addressed consumer interest in a prescription weight-loss drug for the overweight Again, her starting point would be the number of overweight individuals in the United States, but this time she concentrated on the data point that 12% of the respondents were ready to immediately go to their health care provider to request a prescription. She believed the previously developed penetration guidelines (10% increasing by 5% per year) and the 60%/20% model for repeat purchases would also apply to this forecast scenario. In a third approach to forecasting, Printup focused on the ideal target consumer educated females, 35-65 of age with BMIs between 25 and 30. Metabical was expected to capture a higher penetration of this ideal target (43 million potential users) than that of the general overweight population. Printup estimated Metabical would capture 30% of the ideal target market in the first year, with a 5% increase in share each year (up to 50% by year five). She felt the 60%/20% model for repeat purchases would hold true for this group of users as well. Printup knew that her pricing and packaging decisions would have a direct impact on sales forecasts. All the pieces of the puzzle were starting to come together, and she was eager to analyze the potential demand and subsequent profitability to help her provide the best recommendations to Long. Conclusion Printup sat down with her reports and notes stacked neatly around the perimeter of her desk. She had several critical decisions to make regarding Metabical's product launch. First, she wanted to determine the optimal package size for the drug. Next, she needed to put more thought into her pricing recommendation. She had developed three initial models for pricing, but felt she needed to explore how each of these would impact profitability before making her recommendation. To do this, she would have to establish initial demand forecasts for the product in its first five years and ensure that her pricing recommendation met the company's desired ROI.