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Forecasting intermittent inventory demands: simple parametric methods vs. bootstrapping

Listed author(s):
  • Syntetos, Aris A.
  • Zied Babai, M.
  • Gardner, Everette S.
Registered author(s):

    Although intermittent demand items dominate service and repair parts inventories in many industries, research in forecasting such items has been limited. A critical research question is whether one should make point forecasts of the mean and variance of intermittent demand with a simple parametric method such as simple exponential smoothing or else employ some form of bootstrapping to simulate an entire distribution of demand during lead time. The aim of this work is to answer that question by evaluating the effects of forecasting on stock control performance in more than 7,000 demand series. Tradeoffs between inventory investment and customer service show that simple parametric methods perform well, and it is questionable whether bootstrapping is worth the added complexity.

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    File URL: http://www.sciencedirect.com/science/article/pii/S0148296315001496
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    Article provided by Elsevier in its journal Journal of Business Research.

    Volume (Year): 68 (2015)
    Issue (Month): 8 ()
    Pages: 1746-1752

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    Handle: RePEc:eee:jbrese:v:68:y:2015:i:8:p:1746-1752
    DOI: 10.1016/j.jbusres.2015.03.034
    Contact details of provider: Web page: http://www.elsevier.com/locate/jbusres

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