Double Exponential Smoothing for Forecast Days Sales Of Inventory

Use Double Exponential Smoothing to forecast days sales of inventory when a trend exists with no seasonal component.

This example applies to the Supply Chain Module. For more information, go to www.minitab.com/supply-chain-module.

Example

Days sales of inventory (DSI) is the average number of days to sell all inventory and WIP (work-in-progress). To calculate days sales of inventory, first divide the value of the inventory by the cost of goods sold. Then multiply this ratio by the number of days in the time period.

In this worksheet, DSI Days is the Y-variable in time order.

C1
`DSI Days`
52.6
49.8
73.7
36.5

How-to

Choose Solutions Modules > Functions > Supply Chain KPIs, then click Launch.
Under Inventory, select Days sales of inventory.
Select Forecast days sales of inventory, then click OK.
Select Double Exponential Smoothing, then click OK.
In Variable, enter the column that contains the days sales of inventory data.
Select Generate forecasts.
- In Number of forecasts, enter the number of consecutive time periods that you want forecasts for.
- In Starting from origin, specify the row number for the first forecast. If you leave this field blank, Minitab starts the forecasts at the end of the time series.
Click OK.

Tip

For more information about this analysis, click Help in the main dialog box.