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    Rights statement: The final, definitive version of this article has been published in the Journal, OMEGA 40 (6), 2012, © ELSEVIER.

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Impact of Information Exchange on Supplier Forecasting Performance

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<mark>Journal publication date</mark>12/2012
<mark>Journal</mark>Omega: The International Journal of Management Science
Issue number6
Number of pages10
Pages (from-to)738-747
Publication StatusPublished
Early online date5/10/11
<mark>Original language</mark>English


Forecasts of demand are crucial to drive supply chains and enterprise resource planning systems. Usually, well-known univariate methods that work automatically such as exponential smoothing are employed to accomplish such forecasts. The traditional Supply Chain relies on a decentralized system where each member feeds its own Forecasting Support System (FSS) with incoming orders from direct customers. Nevertheless, other collaboration schemes are also possible, for instance, the InformationExchange framework allows demand information to be shared between the supplier and the retailer. Current theoretical models have shown the limited circumstances where retailer information is valuable to the supplier. However, there has been very little empirical work carried out. Considering a serially linked two-level supply chain, this work assesses the role of sharing market sales information obtained by the retailer on the supplierforecasting accuracy. Weekly data from a manufacturer and a major UK grocery retailer have been analyzed to show the circumstances where information sharing leads to improved forecasting accuracy. Without resorting to unrealistic assumptions, we find significant evidence of benefits through information sharing with substantial improvements in forecast accuracy.

Bibliographic note

The final, definitive version of this article has been published in the Journal, OMEGA 40 (6), 2012, © ELSEVIER.