Petropoulos, Fotios, Wang, Xun and Disney, Stephen
2019.
The inventory performance of forecasting methods: evidence from the M3-competition data.
International Journal of Forecasting
35
(1)
, pp. 251-265.
10.1016/j.ijforecast.2018.01.004
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Abstract
Forecasting competitions have been a major drive not only for improving the performance of forecasting methods but also for the development of new forecasting approaches. Despite the tremendous value and impact of these competitions, they suffer from the limitation is that performance is measured only in terms of forecast accuracy and bias, lacking utility metrics. Using the monthly industry series of the M3-competition, we empirically explore the inventory performance of widely used forecasting techniques, including exponential smoothing, ARIMA models, Theta method and approaches based on multiple temporal aggregation. We employ a rolling simulation approach and analyse the results for the order-up-to policy under various lead times. We find that methods based on combinations result in superior inventory performance, while Na¨ıve, Holt and Holt-Winters perform poorly.
Item Type: | Article |
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Date Type: | Publication |
Status: | Published |
Schools: | Business (Including Economics) |
Subjects: | H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management |
Uncontrolled Keywords: | forecasting, inventory, evaluation, utility metrics, bullwhip effect |
Publisher: | Elsevier |
ISSN: | 0169-2070 |
Date of First Compliant Deposit: | 12 March 2018 |
Date of Acceptance: | 16 January 2018 |
Last Modified: | 28 Jun 2019 15:25 |
URI: | http://orca.cf.ac.uk/id/eprint/109815 |
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