smoothing forecast analysis

Smoothing Forecast Analysis Week Widgets No. Sold 1 40 2 90 3 100 4 110 5 90 6 120 7 109 8 96 9 80 10 120 11 130 12 200 13 190 14 180 15 200 Forecast For Week 16 Smoothed Forecast #N/A 40.00 75.00 92.50 104.75 94.43 112.33 110.00 100.20 86.06 109.82 123.95 177.18 186.16 181.85 194.55 250 200 Widgets 150 Baseline Forecast 100 Linear (Baseline) 50 0 1 2 3 4 5 6 7 8 Week 9 10 11 12 13 14 15 The fundamental idea behind smoothing is that each new forecast is obtained in part by moving the prior forecast in a direction that would have improved the old forecast. The equation is: F[t+1] = F[t] + a x e[t] where: 1. t is the time period 2. F[t] is the forecast at time t, and F[t+1] is the forecast at the time period immediately following time t 3. a is the smoothing constant (Never exceed .7) 4. e[t] is the error: the difference between the forecast for time t and the actual observation at time t How do you use it? Enter your business units (widgets) and this sheet will forecast unit sales for you. This sheet is fully functional. To remove protection click Tools / Protection / Unprotect sheet. © Copyright, 2007, Jaxworks, All Rights Reserved. Since 1996, JaxWorks has offered a suite of Free Excel workbooks and spreadsheets, and ass documents, that cover a number of financial, accounting and sales functions. These are invalua Also included Free are: - business plan tools, including spreadsheets and excellent instructions - Excel functions glossary and guide; - free training courses for most Microsoft Office applications. These guides are in PDF format and rival commercial books! - comprehensive list of acronyms, ratios and formulas in customer financial analysis, and financial terms; - suite of online calculators, including, breakeven analysis, productivity analysis, business evaluation; - Altman Z-Score (covering publicly and privately held firms, and small businesses); - and payroll analysis. If you are involved in financial analysis at any level, or want to learn more about MS Excel and suite this site is invaluable. JaxWorks Small Business Spreadsheet Factory spreadsheets, and associated MS Word, PDF and HTML ons. These are invaluable small business tools. uides are in about MS Excel and other applications in the Office sheet Factory