ABSTRACT
This chapter discusses commonly practiced forecasting methods in industry. Demand forecasts are used by all business functions. There are a number of forecasting methods that are available in the literature. They can be broadly classified into two categories: qualitative or judgmental methods and quantitative or statistical methods. The Delphi Method uses a scientifically conducted anonymous survey of key experts who are knowledgeable about the item being forecasted. Quantitative forecasting methods assume that the "conditions" that generated the past demand will generate the future demand; that is, history will tend to repeat itself. The constant level forecasting methods assume that the values of demand in the various periods form a stationary time series. Regular exponential smoothing model estimates the constant level to forecast future demands. There are several uses of the different forecast errors. It is recommended that multiple measures of forecast errors be used in selecting the best forecasting method.
