{"id":6951,"date":"2018-05-31T07:57:53","date_gmt":"2018-05-31T11:57:53","guid":{"rendered":"https:\/\/demand-planning.com\/?p=6951"},"modified":"2018-05-31T07:57:53","modified_gmt":"2018-05-31T11:57:53","slug":"holt-winters-smoothing","status":"publish","type":"post","link":"https:\/\/demand-planning.com\/2018\/05\/31\/holt-winters-smoothing\/","title":{"rendered":"Ask Dr. Jain: How Do I Get Started With Holt Winters Exponential Smoothing?"},"content":{"rendered":"

Question<\/h3>\n

I work for an FMCG company with 300+ SKUs<\/a>. The company wants to move towards bottom
\nup forecasting at regional and customer level for each SKU<\/a>, using the Holt Winters<\/a> method.
\nWhat is the best way to go about it and which softwares\/tools can I use for this purpose which
\nwill also be easy to learn and implement? I am new to forecasting and not aware of the best approach.<\/p>\n

Fatima,<\/strong><\/p>\n

Planning Professional at a large FMCG company<\/strong><\/p>\n

Answer<\/h3>\n

It is true that most organizations use the\u00a0bottom-up<\/a> approach to forecasting. But the
\nmost recent IBF<\/a> survey shows that\u00a0 the middle-out approach\u00a0<\/a>(category level forecasts) yields the
\nleast amount of error. Once you get the category level forecasts, you can dis-aggregate them
\ninto SKU<\/a> level and customer level forecasts, and combine them to get the aggregate level
\nforecast.<\/p>\n

I cannot tell you whether or not exponential<\/a> smoothing\u00a0is the best model for you. I suggest you test
\nthis and other models by preparing ex post forecasts (preparing forecasts of those periods for
\nwhich actuals are known) and then determine which model on average yields the least
\namount of error. It is difficult for me to say which software is best for you as different software
\npackages use slightly different models and use them a little differently.<\/p>\n

Dr. Chaman Jain,<\/strong><\/p>\n

St. John\u2019s University<\/strong><\/p>\n

 <\/p>\n<\/span>","protected":false},"excerpt":{"rendered":"

Question I work for an FMCG company with 300+ SKUs. The company wants to move towards bottom up forecasting at regional and customer level for each SKU, using the Holt Winters method. What is the best way to go about it and which softwares\/tools can I use for this purpose which will also be easy […]<\/p>\n","protected":false},"author":4,"featured_media":6952,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[386,387],"tags":[427,426],"class_list":{"0":"post-6951","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-analytics","8":"category-models-and-methods","9":"tag-bottom-up","10":"tag-holt-winters"},"_links":{"self":[{"href":"https:\/\/demand-planning.com\/wp-json\/wp\/v2\/posts\/6951"}],"collection":[{"href":"https:\/\/demand-planning.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/demand-planning.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/demand-planning.com\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/demand-planning.com\/wp-json\/wp\/v2\/comments?post=6951"}],"version-history":[{"count":0,"href":"https:\/\/demand-planning.com\/wp-json\/wp\/v2\/posts\/6951\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/demand-planning.com\/wp-json\/wp\/v2\/media\/6952"}],"wp:attachment":[{"href":"https:\/\/demand-planning.com\/wp-json\/wp\/v2\/media?parent=6951"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/demand-planning.com\/wp-json\/wp\/v2\/categories?post=6951"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/demand-planning.com\/wp-json\/wp\/v2\/tags?post=6951"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}