Jerry Z. Shan Julie Ward Shelen Jain Jose Beltran Feridoun Amirjalayer Young-Wook Kim
Abstract
Spare parts generate high sales margins and improve customer loyalty by extending the useful life of base products. Forecasting and managing the spare-parts business is challenging, however, due in no small measure to short life cycles and long support life for the base products. At Hewlett-Packard, the Replacement Parts Business (RPB) was challenged by shortages that drove customers to competing parts suppliers. To deal with this threat, an HP team refined the company’s forecasting methodology. This paper describes the business issues involved and the forecasting processes developed. Of particular methodological interest is their approach to (a) choosing between monthly and quarterly forecasts, (b) adjusting the historical data for price/promotion effects, and (c) combining regression and time-series forecasts. Copyright International Institute of Forecasters, 2009
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
page. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.