Period t

1
2
3
4
5
6
7
8
9
10
11
12

Demand Dt
8,000
13,000
23,000
34,000
10,000
18,000
23,000
38,000
12,000
13,000
32,000
41,000

Historical Demand Data

45,000
40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
1

10

Series1

10

11

12

Period t
1
2
3
4
5
6
7
8
9
10
11
12

Demand Dt Deseasonalized Demand

8,000
13,000
23,000
19,750
34,000
20,625
10,000
21,250
18,000
21,750
23,000
22,500
38,000
22,125
12,000
22,625
13,000
24,125
32,000
41,000

Dt = L + T*t
30,000
25,000
20,000
15,000
10,000
5,000
1

Series1

SUMMARY OUTPUT
Regression Statistics
Multiple R
0.958065237
R Square
0.917888998
Adjusted R Square
0.90420383
Standard Error
414.5033124
Observations
8
ANOVA
df
Regression
Residual
Total

Intercept
X Variable 1

1
6
7

SS
11523810
1030878
12554688

Coefficients Standard Error

18439
441
524
64

MS
11523810
171813

t Stat

F
67

Significance F
0

0
0

Lower 95%
17360
367

P-value
42
8

Upper 95% Lower 95.0% Upper 95.0%

19518
17360
19518
680
367
680

Period
t

Demand
Dt
0
1
2
3
4
5
6
7
8
9
10
11
12

8,000
13,000
23,000
34,000
10,000
18,000
23,000
38,000
12,000
13,000
32,000
41,000

13
14
15
16

11910
17614
30787
44642

Estimated Seasonal
Deseasonalized Demand Seasonal Factors Factor for corresponding
Dt
St
seasons
18,963
19,487
20,011
20,535
21,059
21,583
22,107
22,631
23,155
23,679
24,203
24,727

Forecast for next year

0.42
0.67
1.15
1.66
0.47
0.83
1.04
1.68
0.52
0.55
1.32
1.66

0.472
0.683
1.171
1.664

50,000
45,000
40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
1

Level
Trend
18439
524

Series1

10 11 12 13 14 15 16

Period Demand Level

Forecast Error
Absolute Error
t
Lt
Dt
Ft
Et
At
1
8,000
2 13,000
3 23,000
19500
4 34,000
20000
19500
9,500
9,500
5 10,000
21250
20000
2,000
2,000
6 18,000
21250
21250
-1,750
1,750
7 23,000
22250
21250 -16,750
16,750
8 38,000
22750
22250
10,250
10,250
9 12,000
21500
22750
9,750
9,750
10 13,000
23750
21500 -10,500
10,500
11 32,000
24500
23750 -17,250
17,250
12 41,000
Forecast
13
24500
14
24500
15
24500

16

24500

Mean Squared
Error
MADt
MSEt

90,250,000
47,125,000
32,437,500
94,468,750
96,587,500
96,333,333
98,321,429
123,226,563

9,500
5,750
4,417
7,500
8,050
8,333
8,643
9,719

Estimate using Moving Average Method

Forecast error is very fairly high and hence this is not correct
12,148 is standard dev
L0 = 1.25*MADt

MAPEt

%Error

is is not correct

95
11
8
44
85
75
33
42

TSt

95
53
38
39
49
53
50
49

1
2
2
-1
0
2
0
-2

Period
t
0
1
2
3
4
5
6
7
8
9
10
11
12

Demand Level
Forecast Error
Absolute Error Mean Squared Error
Lt
Dt
Ft
Et
At
MSEt
22,083
8,000
20,675
22,083
14,083
14,083
198,340,278
13,000
19,908
20,675
7,675
7,675
128,622,951
23,000
20,217
19,908
-3,093
3,093
88,936,486
34,000
21,595
20,217 -13,783
13,783
114,196,860
10,000
20,436
21,595
11,595
11,595
118,246,641
18,000
20,192
20,436
2,436
2,436
99,527,532
23,000
20,473
20,192
-2,808
2,808
86,435,714
38,000
22,226
20,473 -17,527
17,527
114,031,550
12,000
21,203
22,226
10,226
10,226
112,979,315
13,000
20,383
21,203
8,203
8,203
108,410,265
32,000
21,544
20,383 -11,617
11,617
110,824,074
41,000
23,490
21,544 -19,456
19,456
133,132,065

Forecast

13

23,490

14
15
16

23,490
23,490
23,490

Estimate using Simple Exponential Smoothing Method

12760.5543
L0 = 1.25*MADt
Standard deviation of forecasted demand error is fairly large relative to the size of th

MADt
14,083
10,879
8,284
9,659
10,046
8,777
7,925
9,125
9,247
9,143
9,368
10,208

%Error
176
59
13
41
116
14
12
46
85
63
36
47

MAPEt
176
118
83
72
81
70
62
60
62
63
60
59

TSt
1.00
2.00
2.25
0.51
1.64
2.15
2.03
-0.16
0.95
1.86
0.58
-1.38

moothing Method

ly large relative to the size of the forecasted demand.

Period
t

Demand
Dt
0
1
2
3
4
5
6
7
8
9
10
11
12

8,000
13,000
23,000
34,000
10,000
18,000
23,000
38,000
12,000
13,000
32,000
41,000

Forecast

13
14
15
16

31,985
33,526
35,067
36,609

Level
Trend
Forecast Error
Absolute Error
Lt
Tt
Ft
Et
At
12,015
1,549
13,008
1,438
13,564
5,564
5,564
14,301
1,409
14,445
1,445
1,445
16,439
1,555
15,710
-7,290
7,290
19,594
1,875
17,993 -16,007
16,007
20,322
1,645
21,469
11,469
11,469
21,570
1,566
21,967
3,967
3,967
23,123
1,563
23,137
137
137
26,018
1,830
24,686 -13,314
13,314
26,262
1,513
27,847
15,847
15,847
26,298
1,217
27,775
14,775
14,775
27,963
1,307
27,515
-4,485
4,485
30,443
1,541
29,270 -11,730
11,730

Estimate using Trend Corrected Exponential Smoothing Method

Though tracking signal is within range and indicate better estimates, MAD is fa
Standard deviation is = 1.25 X 8836 i.e. 11,045 is still fairly large.

Mean Squared Error

MSEt
30,958,096
16,523,523
28,732,318
85,603,146
94,788,701
81,613,705
69,957,267
83,369,836
102,010,079
113,639,348
105,137,395
107,841,864

MADt
5,564
3,505
4,767
7,577
8,355
7,624
6,554
7,399
8,338
8,981
8,573
8,836

%Error
70
11
32
47
115
22
1
35
132
114
14
29

rrected Exponential Smoothing Method

ge and indicate better estimates, MAD is fairly large.

i.e. 11,045 is still fairly large.

MAPEt
70
40
37
40
55
49
42
41
52
58
54
52

TSt
1.00
2.00
-0.06
-2.15
-0.58
-0.11
-0.11
-1.90
0.22
1.85
1.41
0.04

SUMMARY OUTPUT
Regression Statistics
Multiple R
0.481327197
R Square
0.23167587
Adjusted R Square
0.154843457
Standard Error
10666.88337
Observations
12
ANOVA
df
Regression
Residual
Total

Intercept
X Variable 1

1
10
11

SS
MS
F
Significance F
343092657.3 343092657.3 3.015340286 0.113127023
1137824009 113782400.9
1480916667

Coefficients Standard Error

t Stat
P-value
Lower 95%
12015.15152
6565.012894 1.830179424 0.09714727 -2612.608777
1548.951049
892.0095994 1.73647352 0.113127023 -438.5701958

Upper 95% Lower 95.0% Upper 95.0%

26642.91181 -2612.608777 26642.91181
3536.472294 -438.5701958 3536.472294

Period
t
0
1
2
3
4
5
6
7
8
9
10
11
12

Demand Deseasonalize Level

Trend
Seasonal Factor Forecast Error
D_bar
Lt
Dt
Tt
St
Ft
Et
18,439
524
8,000
18,862
514
0.472
8,951
951
13,000
19,359
512
0.683 13,234
234
23,000
19,750
19,860
511
1.171 23,269
269
34,000
20,625
20,374
511
1.664 33,897
-103
10,000
21,250
20,911
514
0.467
9,758
-242
18,000
21,750
21,674
539
0.682 14,609
-3,391
23,000
22,500
22,085
526
1.170 25,983
2,983
38,000
22,125
22,622
527
1.664 37,636
-364
12,000
22,625
23,273
540
0.468 10,841
-1,159
13,000
24,125
23,555
514
0.697 16,591
3,591
32,000
24,248
532
1.157 27,845
-4,155
41,000
24,772
531
1.666 41,284
284

Estimate using Trend Corrected Exponential Smoothing Method

Forecast

13
14
15
16

11969
17624
30930
44778

0.473
0.682
1.173
1.665
Standard Deviation =

1.25 X MAD
=
1846.34959
Tracking signal is within range as well as standard deviation.

Absolute Error Mean Squared Error

At
MSEt

moothing Method

951
234
269
103
242
3391
2983
364
1159
3591
4155
284

903,519
479,131
343,599
260,343
219,996
2,099,992
3,070,760
2,703,466
2,552,289
3,586,376
4,829,951
4,434,173

MADt
951
592
485
389
360
865
1167
1067
1077
1329
1586
1477

%Error
11.88
1.80
1.17
0.30
2.42
18.84
12.97
0.96
9.66
27.62
12.99
0.69

MAPEt
11.88
6.84
4.95
3.79
3.52
6.07
7.05
6.29
6.67
8.76
9.15
8.44

TSt
1.00
2.00
3.00
3.47
3.08
-2.64
0.60
0.32
-0.76
2.08
-0.87
-0.75

Comparison
Forecasting Method
MAD
MAPE
Moving Average
9,719
Simple Exponential Smoothing
10,208
Holt's Model
8,836
Winter's Model
1,477
So, Winter's model is most suitable.

49.00
59.00
52.00
8.44

TS Range
-1.52 to 2.21
-1.38 to 2.15
-2.15 to 2.00
-2.64 to 3.47