Single Exponential Smoothing for Forecast Months On Hand

Use Single Exponential Smoothing to forecast months of available inventory when your data do not have a trend or seasonal component.

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

Example

Months on hand is the number of months of available inventory that exists if no new purchases are made and sales continue as forecasted. To calculate months on hand inventory, divide the value of the inventory by the cost of goods sold. Then multiply by the number of months in the time period.

In this worksheet, Months on Hand is the Y-variable in time order.

C1
`Months on Hand`
1.73
1.64
3.4
2.5

How-to

Choose Solutions Modules > Functions > Supply Chain KPIs, then click Launch.
Under Inventory, select Months on hand.
Select Forecast Months On Hand, then click OK.
Select Single Exponential Smoothing, then click OK.
In Variable, enter the column that contains the months 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.