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Presented to-SIMRIT MANN

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5011-JYOTSNA PATEL

5012-NILESH PATEL

5013-RIDDHI PATEL

5015-HARDIK PORIYA 5016-SUPRIYA PUJARI 5017-ADITIYA RAI 5018-SEEMA RAJPUROHIT

5019-GARIMA RAMBIYA 5020-SONAL RAMOLIYA

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Forecasting involves predicting the future. It helps in projection of the volume or

number of units that will be required to beproduced, shipped or sold.

The forecasting process affects every area oflogistics in some way or the others. i.e isconducting or developing forecast providinginformation to be used in forecasting or

receiving forecasting results andimplementing necessary actions.

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VERICAL DEPENDENT DEMAND -IT IS ACHARACTERISED BY SEQUENCE OF

PURCAHSING AND MANUFACTURING.

HORIZONTAL DEPENDENT DEMAND IT

OCCURS IN A SITUATION WHERE AN

ATTACHMENT, PROMTION ITEM IS INCLUDED

WITH EACH ITEM SHIPPED.

DEPENDENT DEMAND

THEY ARE THOSE DEMANDS THAT ARE NOT

RELATED TO THE DEMAND FOR ANOTHER

ITEM.

INDEPENDENTDEMAND

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Forecast Components

Forecast

components

Base Demand

Seasonal factors

Trends

Cyclic factors

Promotions

Irregular Quantities

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Base Demand- It is based on averagedemand over an extended period oftime.

Seasonal Component- It is generallycharacterized by upward and downwardmovement in demand pattern usually

on annual basis.

Trend Component- It is a long rangegeneral movement in periodic sales

over an extended period of time.Bt+1=bt x 1

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Cyclic Component- It swings in demandpattern lasting more than a year.

Promotional Component- Demand swingsinitiated by the firms marketing activitiessuch as advertising, schemes, promotions

constitutes the promotional component.

Irregular Component- It includes random orunpredictable quantities that do not fit within

the other categories and hence areimpossible to predict.

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Techniques

Quantitative /

Statistical

Methods

Qualitative /

Judgmental

Methods

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Quantitative methodsIt involves time series techniques.

Time series they are statistical methods usinghistorical sales data that contain relatively clearand stable relationship and trends.

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Moving average- Moving average forecastinguses an average of most recent periodssales.

Exponential smoothing analyses- it is basedon the principle that the most recent values is

the most important for predicting the futurevalue.

Y1t+1 = ayt + (1-a)Y1 t

REGRESSION analyses- It is to collect the pastavailable data and analyse them for the futurestrategies Y=a+bx+ui

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Qualitative Forecasting

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Delphi- By OLAF HELMER sponsored by US AirForce in 1950s. The method is generally used forlong term forecasting

Nominal Group technique- developed by AndrewVan de Ven a Wharton professor is a structuredproblem solving and decision making method.

Survey- it involves gathering these data from avariety of potential customers, typically throughinterviews, telephone based service and writtenservice.

Market Research- In market testing focus groupsof potential customers are assembled and testedfor their response to products.

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Operations Management----By ICFAI Operations Management-An integrated goods

and services approach----By Evans/Collier

Logistics and Supply Chain Management----By Vinay Pandit

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