Analytics Exercise 18-1 (Algo)

Starbucks has a large, global supply chain that must efficiently supply over 17,000 stores. Although the stores might appear to be very similar, they are actually very different. Depending on the location of the store, its size, and the profile of the customers served, Starbucks management configures the store offerings to take maximum advantage of the space available and customer preferences.

Starbucks actual distribution system is much more complex, but for the purpose of our exercise lets focus on a single item that is currently distributed through five distribution centers in the United States. Our item is a logo-branded coffeemaker that is sold at some of the larger retail stores. The coffeemaker has been a steady seller over the years due to its reliability and rugged construction. Starbucks does not consider this a seasonal product, but there is some variability in demand. Demand for the product over the past 13 weeks is shown in the following table. (week 1 is the week before week 1 in the table, 2 is two weeks before week 1, etc.).

Management would like you to experiment with some forecasting models to determine what should be used in a new system to be implemented. The new system is programmed to use one of two forecasting models: simple moving average or exponential smoothing.

WEEK	5	4	3	2	1	1	2	3	4	5	6	7	8	9	10	11	12	13
Atlanta	46	32	33	57	34	34	47	35	34	55	33	21	57	45	35	25	56	40
Boston	61	22	44	47	33	37	32	48	41	49	48	50	24	67	41	36	40	50
Chicago	52	26	69	35	43	43	35	27	48	47	66	64	30	26	88	34	44	46
Dallas	33	28	35	54	43	28	30	35	41	45	55	65	62	45	38	34	38	42
LA	38	42	46	36	37	39	43	45	46	48	65	43	34	39	40	45	50	50
Total	230	150	227	229	190	181	187	190	210	244	267	243	207	222	242	174	228	228

Only need help with question B.

a. Consider using a simple moving average model. Experiment with models using five weeks and three weeks past data. (Round your answers to 2 decimal places.)

3-week MA

5-week MA

b. Evaluate the forecasts that would have been made over the 13 weeks using the overall (at the end of the 13 weeks) mean absolute deviation, mean absolute percent error, and tracking signal as criteria. (Negative values should be indicated by a minus sign. Round all answers to 2 decimal places. Enter "MAPE" answers as a percentage rounded to 2 decimal places.)

\begin{tabular}{|l|r|r|r|r|r|r|r|} \hline Week & \multicolumn{1}{|c|}{ ATL } & \multicolumn{1}{c|}{ BOS } & \multicolumn{1}{c|}{ CHI } & \multicolumn{1}{c|}{ DAL } & \multicolumn{1}{c|}{ LA } & \multicolumn{1}{c|}{ Total } \\ \hline 1 & 41.33 & 41.33 & 49.00 & 44.00 & 39.67 & 215.33 \\ \hline 2 & 41.67 & 39.00 & 40.33 & 41.67 & 37.33 & 200.00 \\ \hline 3 & 38.33 & 34.00 & 40.33 & 33.67 & 39.67 & 186.00 \\ \hline 4 & 38.67 & 39.00 & 35.00 & 31.00 & 42.33 & 186.00 \\ \hline 5 & 38.67 & 40.33 & 36.67 & 35.33 & 44.67 & 195.67 \\ \hline 6 & 41.33 & 46.00 & 40.57 & 40.33 & 46.33 & 214.67 \\ \hline 7 & 40.67 & 46.00 & 53.67 & 47.00 & 53.00 & 240.33 \\ \hline 8 & 36.33 & 49.00 & 59.00 & 55.00 & 52.00 & 251.33 \\ \hline 9 & 37.00 & 40.67 & 53.33 & 60.67 & 47.33 & 239.00 \\ \hline 10 & 41.00 & 47.00 & 40.00 & 57.33 & 38.67 & 224.00 \\ \hline 11 & 45.67 & 44.00 & 48.00 & 48.33 & 37.67 & 223.67 \\ \hline 12 & 35.00 & 48.00 & 49.33 & 39.00 & 41.33 & 212.67 \\ \hline 13 & 38.67 & 39.00 & 55.33 & 36.67 & 45.00 & 214.67 \\ \hline \end{tabular} \begin{tabular}{|l|r|r|r|r|r|r|} \hline Week & \multicolumn{1}{|c|}{ ATL } & \multicolumn{1}{c|}{ BOS } & \multicolumn{1}{c|}{ CHI } & \multicolumn{1}{c|}{ DAL } & \multicolumn{1}{c|}{ LA } & \multicolumn{1}{c|}{ Total } \\ \hline 1 & 40.40 & 41.40 & 45.00 & 38.60 & 39.80 & 205.20 \\ \hline 2 & 38.00 & 36.60 & 43.20 & 37.60 & 40.00 & 195.40 \\ \hline 3 & 41.00 & 38.60 & 45.00 & 38.00 & 40.20 & 202.80 \\ \hline 4 & 41.40 & 39.40 & 36.60 & 38.00 & 40.00 & 195.40 \\ \hline 5 & 36.80 & 38.20 & 39.20 & 35.40 & 42.00 & 191.60 \\ \hline 6 & 41.00 & 41.40 & 40.00 & 35.80 & 44.20 & 202.40 \\ \hline 7 & 40.80 & 43.60 & 44.60 & 41.20 & 49.40 & 219.60 \\ \hline 8 & 35.60 & 47.20 & 50.40 & 48.20 & 49.40 & 230.80 \\ \hline 9 & 40.00 & 42.40 & 51.00 & 53.60 & 47.20 & 234.20 \\ \hline 10 & 42.20 & 47.60 & 46.60 & 54.40 & 45.80 & 236.60 \\ \hline 11 & 38.20 & 46.00 & 54.80 & 53.00 & 44.20 & 236.20 \\ \hline 12 & 36.60 & 43.60 & 48.40 & 48.80 & 40.20 & 217.60 \\ \hline 13 & 43.60 & 41.60 & 44.40 & 43.40 & 41.60 & 214.60 \\ \hline \end{tabular} \begin{tabular}{|l|c|c|c|c|c|c|c|} \hline & & ATL & BOS & CHI & DAL & LA & Avg of DCs \\ \hline 3-week MA & MAD & & & & & & \\ \hline & MAPE & & & & & & \\ \hline & TS & & & & & & \\ \hline 5-week MA & MAD & & & & & & \\ \hline & & & & & & & \\ \hline & MAPE & & & & & & \\ \hline & TS & & & & & & \\ \hline \end{tabular}