Aquasoft sells water purifiers from its only store in Ion Orchard. The record of sales transaction for
Question:
Aquasoft sells water purifiers from its only store in Ion Orchard. The record of sales transaction for the year 2019 is shown in Table 1. The company wants to forecast monthly sales for 2020 based on the sales for water purifiers in 2019.
The operations manager is confused whether to use moving average or exponential smoothing method for forecasting. Suggest to the operations manager the better method.
In your answer, plot a graph to show the demand over time and comment on the demand pattern. Examine the demand forecast using three-month and four-month moving averages. For exponential smoothing, use smoothing constant of 0.1 to 0.3 with initial value of 200 to forecast demand. Show how you derive the forecast and errors of forecast. Give reasons to support your recommendation.
Data Analysis and Decision Making
ISBN: 978-0538476126
4th edition
Authors: Christian Albright, Wayne Winston, Christopher Zappe