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Forecast Tree Demantra

The document discusses forecast trees in Demantra forecasting software. It explains that the forecast tree determines the item and location combinations for which the engine will generate forecasts, starting at lower aggregation levels and moving up to higher levels if there is insufficient accurate sales history data. It also notes that the forecast tree setup impacts forecast accuracy and should include 3 to 6 meaningful levels for the business, including the level at which accuracy is measured.

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Shivgan Joshi
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388 views5 pages

Forecast Tree Demantra

The document discusses forecast trees in Demantra forecasting software. It explains that the forecast tree determines the item and location combinations for which the engine will generate forecasts, starting at lower aggregation levels and moving up to higher levels if there is insufficient accurate sales history data. It also notes that the forecast tree setup impacts forecast accuracy and should include 3 to 6 meaningful levels for the business, including the level at which accuracy is measured.

Uploaded by

Shivgan Joshi
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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Forecast Tree

Demantra

Theoretical EngineModels

Accuracy Metrics for Forecasts

Forecast Tree [1/2]


The forecast tree determines which item/location
aggregation combination the engine will forecast at. The
engine examines each level in the forecast tree and
validates if there is enough sales history data available
for forecasting or if the forecast generated have
sufficient accuracy at that level. In case the validation
fails, the engine moves on to next level and continue
with the validation phase until it finds a level where it
can generate a forecast. In case the engine ends up
forecasting at a higher level of aggregation in the
forecast tree, the forecast is split to the lower levels.

Forecast Tree [2/2]


Forecast tree is a system configuration that has a direct
bearing on the forecast accuracy. This is one of the first
setups that need to be done after careful analysis of the
sales history and after discussion with users.
The forecast levels should be meaningful to the
business users and it is recommended to have between
3 and 6 levels that the engine can traverse and
forecast. It is useful for the forecast tree to include the
level on which accuracy is measured, if possible.

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