Business forecasting

Volatility has an impact on the accuracy of forecasting. The Company on whichthis project report is based firmly believed that the agricultural segment of theirpackaging manufacturing business was too volatile to forecast. Economicpressures were however forcing this belief to be questioned. This project reportexamined if forecasting was applicable to the business, what techniques could beused and demonstrated the various techniques using data supplied by theCompany.The main finding was that forecasting is applicable. Due to the volatility in theindividual product data it was recommended that forecasting be applied at theaggregated family of products level. Adaptive filtering was consistently the mostaccurate forecasting technique but a combined forecast using the simple averageof the various techniques was recommended.This combined forecast produced adequate models but failed to forecast themagnitude of the seasonal peak which is dependent on the climatic conditionsexperienced