Assignment:
Q: Krystyna Smith is the operations manager for Wayne's lceCream Parlor, an ice cream manufacturing and retailing company. The company produces over 20 flavors of ice cream. Krystyna does not have a good understanding of how the company forecasts demand for ice cream because it is coded into the company's ERP system, and there is no documentation detailing how forecasts are calculated. In order to assess how well the system is forecasting, she has selected one representative flavor. She has asked you to recommend a forecasting method. Utilize the data in the table to address the following issues:
1. Recommend a yearly forecasting method for this flavor based on a review of the data. In doing so, you would need to compare three forecasting methods (trend projection among them and, then, recommend the most accurate one.
2. Forecast demand for the next two years
3. Forecast demand for Jan, July and August in the following year
4. Evaluate the performance of the three forecasting methods using common measures of forecast error (e.g., MAD)
5. Please provide numerical support for your recommendation
|
Month
|
Year 1
|
Year 2
|
Year 3
|
|
Jan
|
5000
|
5200
|
5300
|
|
Feb
|
5500
|
5400
|
6200
|
|
Mar
|
5300
|
5500
|
5800
|
|
Apr
|
7500
|
7700
|
8300
|
|
May
|
8000
|
8600
|
9000
|
|
Jun
|
8700
|
8900
|
9500
|
|
Jul
|
9300
|
10000
|
9800
|
|
Aug
|
10400
|
10700
|
11400
|
|
Sep
|
8300
|
8700
|
8500
|
|
Oct
|
7400
|
7900
|
8000
|
|
Nov
|
4500
|
4700
|
4800
|
|
Dec
|
4100
|
4300
|
4600
|