Setting Up Advanced Demand Forecasting

Forecasting

• Min Hits - Minimum hits needed for an item to qualify for advanced demand forecasting. The system compares this to the current forecast period hits by branch to determine if this has been met.

• Max Years History - This field must be set between 3 and 10 years. The more years you select the longer the forecast program may run, but the more years you use the more accurate your forecasting values.

Note: You are restricted to the number of years' activity based on the Number Of Years Sales In PSUB File control maintenance record.

Smoothing Factors

• Max Level (Alpha) - This field must be set between 0.05 and 0.25.

• Max Trend (Beta) -  This field must be set between 0.05 and 0.25.

• Max Seasonal (Gamma) - This field must be set between zero (0) and 0.50.

For more information about how smoothing factors work, see Advanced Demand Forecasting Overview.

Seasonality

• Min Hits - Enter the number of hits an item should have to be included in the seasonality pattern test. This number must be greater or equal to the Minimum Hits for Advanced Forecasting (above).

• Min Months History - This field must be set between 13 and 36 months.

• Exclude Seasonal Forecasts For Non-Seasonal Items - Select the items that are not flagged as seasonal and do not have seasonal trending that you want to exclude from the seasonal forecasting calculations.

• Include Seasonal Forecasts For Non-Seasonal Items - Select to include all items in the seasonal forecasting calculations regardless of their classification.

Important: Using this setting may increase the amount of time the system requires to run the Update Demand Forecast.

Outcome of setting this control record

Eclipse uses these settings to calculate demand forecast and seasonality testing.

Default Value(s)

Advanced Forecasting Defaults:

• Min Hits: 10

• Max History in years: 5

• Max Alpha: 0.15

• Max Beta: 0.15

• Max Gamma: 0.5

Advanced Forecasting Defaults for Seasonality:

• Min Hits: 10

• Min History in months: 24

Dependencies

Update Demand Forecast program should be addressed.

Using the Exclude Negative Quantities From Item Demand Calculations control maintenance record will eliminate any negative quantities, but does not eliminate the system actually calculating a negative demand. This means if you use Holt or Holt-Winters and your sales have actually gone down over the specified period, the system will show a negative demand.

Action if set to Null

None.

Additional Information

Complete the Update Demand Forecast program.