Reference no: EM133606210
Question 1 (1) Forecast using a 5-week SMA model from period 1 to period 13 for each distribution center; and (2) evaluate the forecasts using MAD, MAPE, and TS as criteria.
Question 2 Repeat the two steps in Q1 with a simple exponential smoothing model (alpha=0.2, first-week forecast (F1) is assumed to be the previous three-week average) and evaluate the new forecasts using MAD, MAPE, and TS as criteria.
Question 3. Starbucks is considering simplifying its supply chain structure, consolidating all 5 distribution centers into one. (1) Compare the results in Q1 and Q2, summarize the key information in a table for comparison, and use data and results to justify which forecasting method works better; (2) Use the better forecasting method to generate the forecast for aggregated demand (total row in Table 1) and evaluate the forecasts using MAD, MAPE, and TS as criteria.
Question 4. (1) Compare the aggregate demand forecast (1 distribution center) with the disaggregate forecast (5 distribution centers), summarize your results, and justify which one works better from the forecast accuracy perspective. (2) What other consideration could be beyond forecasting accuracy that shapes the decision to go from multiple DCs to one DC?