Determine the best technique for forecasting tfy demand

Reference no: EM13185489

Tires for You, Inc. (TFY), founded 1987, is an automotive repair shop specializing in-replacement tires. Located in Altoona, Pennsylvania, TFY has grown successfully over the past few years because of the addition of a new general manager, Katie McMullen. Since tire replacement is a major portion of TFY's business (It also performs oil changes, small mechanical repairs, etc.), Katie was surprised at the lack of forecasts for tire consumption for the company,. Her senior mechanic, Skip Grenoble, told her that they usually stocked for this year what they sold last year. He readily admitted that several times throughout the season stockout occurred and customers had to go elsewhere for tires.

Although many tire replacements were for defective or destroyed tires, most tires were installed on cars whose original tires had worn out. Most often, four tires were installed at the same time. Katie was determined to get a better idea of how many tires to hold in told in stock during the various months of the year. Listed below is a summary of last
year's individual tire sales by month:

MONTH Tires Used
January 510
February 383
March 1,403
April 1,913
May 1,148
June 893
July 829
August 638
September 2,168
October 1,530
November 701
December 636
Total 12,752

Kate has hired you to determine the best technique for forecasting TFY demand based on the given data.

1. Calculate a forecast using a simple three-month moving average.

Reference no: EM13185489

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