Demand Forecasting Using a Growth Model and Negative Binomial Regression Framework

• Main Authors: ONG, Cally Yeru, CHOY, Murphy, CHEONG, Michelle L. F.
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2013
• Subjects: Growth models; watch industry; sales forecasting; MITB student; Computer Sciences; Operations Research, Systems Engineering and Industrial Engineering; Sales and Merchandising
• Online Access: https://ink.library.smu.edu.sg/sis_research/1675; https://ink.library.smu.edu.sg/context/sis_research/article/2674/viewcontent/DemandForecasting_GrowthModel_SAS_2013_av.pdf
• Institution: Singapore Management University

In this paper, we look at demand forecasting by using a growth model and negative binomial regression framework. Using cumulative sales, we model the sales data for different wristwatch brands and relate it to their sales and growth characteristics. We apply clustering to determine the distinctive characteristics of each individual cluster. Four different growth models are applied to the clusters to find the most suitable growth model to be used. After determining the appropriate growth model to be applied, we then forecast the sales by applying the model to new products being launched in the market and continue to monitor the model further.