# Wilkins, a Zurn Company: Demand Forecasting

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Wilkins, A Zurn Company: Demand Forecasting

Session Time:        MW 11:30 AM

Team member names: Amogh Mirikar, Chia-Jung Hsu, Hee- kyoung Han, Rohan Shah, Yashna Shine

1. How accurate was Wilkins demand forecast for the first quarter of 2005? Use the forecast error and MAPE to calculate forecast accuracy. Calculate the accuracies for the fire valves and PVBs aggregate family of products as well as for each product of both families individually. Note: to disaggregate the product family forecast into the individual products use the planning bill % of Exhibits 3 and 4.

The Forecast overestimates the real demand in every single product. For the first quarter, Connors and Fields have forecasted the sales to be 53,560 units of PVB and 559 units of Fire valves. However, with reference to the Exhibit 2, we find that the actual sales of PVB were less than the forecast i.e. 48,159 units and that of Fire Valves were more than the forecast i.e. 580 units. Hence, Connors and Fields have over forecasted the sales of PVB by 11.21% and under-forecasted the sales of Fire valves by 3.62%.

Aggregate Family of Product: PVBs and Fire Valves

 Product Period Forecast Actual Error, Et Absolute E MAPE (A) (B) (C=A-B) (D=ABS(C)) (E=D/B*100) PVBs 2005-1Q 53,560 48,159 5,401 5,401 11.21% Fire Valves 2005-1Q 559 580 -21 21 3.62%

Individual Product in the first Q of 2005: PVBs

 Product Forecast Actual Error, Et Absolute E MAPE (A) (%) (B) (C=A-B) (D=ABS(C)) (E=D/B*100) 12-720 5,677 10.60% 6,237 -558 558 8.95% 34-720 13,444 25.10% 28,020 -14,576 14,576 52.02% 1-720 23,620 44.10% 11,163 12,457 12,457 115.59% 34-420 6,427 12.00% 384 6,043 6,043 1573.70% 1-420 4,392 8.20% 2,357 2,035 2,035 86.34% Total 53,560 100.00% 48,159

Individual Product in the first Q of 2005: Fire Valves

 Product Forecast Actual Error, Et Absolute E MAPE (A) (%) (B) (C=A-B) (D=ABS(C)) (E=D/B*100) 12-720 119 21.20% 85 34 34 40.00% 34-720 216 38.80% 199 17 17 8.54% 1-720 66 11.80% 140 -74 74 52.86% 34-420 46 8.20% 66 -20 20 30.30% 1-420 112 20.00% 90 22 22 24.44% Total 559 100.00% 580
1. What is the current demand forecasting method? Which departments use the demand forecast? What are the consequences, if any, if the forecast is inaccurate?

The current forecasting method uses Planning bill and Forecast Master, which lists the average weekly sales history for each product family by quarter and year since 1999. For each product family, they divide the total quarters in weeks to determine the average weekly sale per quarters. Then they add the expected percentage increase in demand for the next five or six quarters.

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