Forcasting with Indices
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Learning Team A: Forecasting with Indices
Within any business there is always a need to analyze data whether it is inventory, financial or even market values. Our team utilized the Winter Historical Inventory data supplied by the University of Phoenix to create a visual representation of the data. This data was complied into a source index by using Microsoft Excel. This time series data was then used to create a visual representation of the forecast inventory for the coming year.
Data is a constant stream of information within small business, in how that data is used could be the determining factor in business growth and success. The data provided by the University of Phoenix was a ???Typical Seasonal Demand for Winter Highs.??? (University of Phoenix, 2010) It showed the actual demands (in units) for twelve months over the course of four years. This raw data needed to be shown in a visual representation, the line graph shown in appendix A, is the culmination of the data.
The data provided was inserted into excel, the averages of each year were then calculated. The data from each year showed an increase of demand in units by roughly two thousand. The data was then broken down further to show within each month over the course of four years. For example, month one was averaged over the four years to give a forecasted average of 47,370 units. Each year was then plotted into the graph showing the trend for the year. The forecast line within the graph is the visual representation of what the coming year could look like. This line was created by taking the average of each month over the four year period and plotting the line.
The forecast line shows the possible demands that could happen based upon the data collected. It shows the trend of high periods during our holiday season, months 1, 2, 10-12. It also shows a low during our non-holiday months (see appendix B).
The data shows common trends that are common with retail stores during holiday seasons. This visual representation can determine the flow of inventory for a business and help prepare the company for possible low periods.