Research output: Contribution to Journal/Magazine › Journal article › peer-review
Research output: Contribution to Journal/Magazine › Journal article › peer-review
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TY - JOUR
T1 - Forecasting and inventory performance in a two-stage supply chain with ARIMA(0,1,1) demand
T2 - theory and empirical analysis
AU - Babai, M. Z.
AU - Ali, M. M.
AU - Boylan, John
AU - Syntetos, A. A.
PY - 2013/6/1
Y1 - 2013/6/1
N2 - The ARIMA(0,1,1) demand model has been analysed extensively by researchers and used widely by forecasting practitioners due to its attractive theoretical properties and empirical evidence in its support. However, no empirical investigations have been conducted in the academic literature to analyse demand forecasting and inventory performance under such a demand model. In this paper, we consider a supply chain formed by a manufacturer and a retailer facing an ARIMA(0,1,1) demand process. The relationship between the forecasting accuracy and inventory performance is analysed along with an investigation on the potential benefits of forecast information sharing between the retailer and the manufacturer. Results are obtained analytically but also empirically by means of experimentation with the sales data related to 329 Stock Keeping Units (SKUs) from a major European superstore. Our analysis contributes towards the development of the current state of knowledge in the areas of inventory forecasting and forecast information sharing and offers insights that should be valuable from the practitioner perspective.
AB - The ARIMA(0,1,1) demand model has been analysed extensively by researchers and used widely by forecasting practitioners due to its attractive theoretical properties and empirical evidence in its support. However, no empirical investigations have been conducted in the academic literature to analyse demand forecasting and inventory performance under such a demand model. In this paper, we consider a supply chain formed by a manufacturer and a retailer facing an ARIMA(0,1,1) demand process. The relationship between the forecasting accuracy and inventory performance is analysed along with an investigation on the potential benefits of forecast information sharing between the retailer and the manufacturer. Results are obtained analytically but also empirically by means of experimentation with the sales data related to 329 Stock Keeping Units (SKUs) from a major European superstore. Our analysis contributes towards the development of the current state of knowledge in the areas of inventory forecasting and forecast information sharing and offers insights that should be valuable from the practitioner perspective.
KW - Inventory
KW - Forecasting
KW - ARIMA demand
KW - Supply chain
KW - Information sharing
U2 - 10.1016/j.ijpe.2011.09.004
DO - 10.1016/j.ijpe.2011.09.004
M3 - Journal article
VL - 143
SP - 463
EP - 471
JO - International Journal of Production Economics
JF - International Journal of Production Economics
SN - 0925-5273
IS - 2
ER -