Abc Floral Shop Forecast

Lea Pratt

American InterContinental University

Global Management

Individual Assignment: Unit 4

ABC Floral Shop Forecast

May 21, 2012

Abstract

Forecasting is the art and science of predicting future events. One forecast method I used was the moving average. The moving average uses a number of data values to generate a forecast. This forecast is useful if you know that the market will stay steady over time. Below I have forecasted the ABC Florist Shop demand using a 3- and 5- point moving average. I started with the 3-period moving average then ended up with the 5-point moving average. I have enclosed a graph that shows the forecast for the 3- and 5- point moving average.

ABC Floral Shop Forecast

Forecasting is the art and science of predicting future events. One forecast method I used was the moving average. The moving average uses a number of data values to generate a forecast. This forecast is useful if you know that the market will stay steady over time (Heizer & Render, 2012).

Calculate a forecast of the above demand using a 3- and 5-period moving average.

When calculating the 3 point average you take the first three demand number for day 1-3 add them and then divide by 3. You will continue to do this until you have finished all of them expect for day 14 (AIU Live Chat, 2012).

Day Demand 3 day Moving average

1 200

2 134

3 157

4 165 (200+134+157)/3= 163.67

5 177 (134+157+165)/3= 152

6 125 (157+165+177)/3= 166.33

7 146 (165+177+125)/3= 155.67

8 150 (177+125+146)/3= 149.33

9 182 (125+146+150)/3= 140.33

10 197 (146+150+182)/3= 159.33

11 136 (150+182+197)/3= 176.33

12 163 (182+197+136)/3= 171.66

13 157 (197+136+163)/3= 165.33

14 169 (136+163+157)/3= 152

When calculating the 5 point average you take the first three demand number for day 1-5 add them and then divide by 5. You will continue to do this until you have finished all of them expect for day 14 (AIU Live Chat, 2012).

Day Demand 5 day Moving average

1 200

2 134