I'd like to use Simple Exponential smoothing to forecast the lead-time demand for inventory control, I have monthly data and LT+1 is equal to 5 months, can I do a forecast using SES which gives me a one-period-ahead forecast and then multiply it by 5 to get the forecast for LT+1 ? what is the best solution to get h step ahead forecast(like LT+1)when the forecast method is SES? Thank you
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Yes, for Single Exponential Smoothing, the lead time demand (which is the sum of the forecasts over the lead time) is necessarily a simple multiple of a one-step-forecast. If you use a more complex model (with seasonality and/or trend), this will of course not hold any more. In addition, you will need to think about safety stocks and quantile forecasts. I recommend this free online textbook on forecasting. |
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