Demand Forecasting
Demand Forecasting in the Indian Retail Industry
Applied Economics (HS 700) Course Project Report Vijay Gabale (07305004) Ashutosh Dhekne (07305016) Piyush Masrani (07305017) Sumedh Tirodkar (07305020) Tanmay Mande (07305051) March 19, 2008
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Contents
1 Introduction 1.1 Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2 Objective . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Challenges Faced in Demand Forecasting 3 Theoretical Framework 3.1 Judgemental . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.2 Methods Requiring Quantitative Data . . . . . . . . . . . . . . . 4 Existing Surveys 5 Our Survey 6 Conclusion 3 3 4 4 6 6 7 8 12 14
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Abstract The retail business in India is expanding in leaps and bounds. With increasing competition, each retailer needs to correctly cope up with the impending demand. The retail firms need to take into account various factors including the lead time and the seasonality of goods. In this report, we study the various techniques used by retailers in India to perform demand forecasting and analysis. We present a case study done at Lakewood Malls Pvt. Ltd. where we understand that historical data and judgemental techniques are primarily used for forecasting of demand.
1
Introduction
The A.T. Kearney Global Retail Development Index showed India on the sixteenth position in 1995. In 2004, the publication said, “Despite India’s stiff regulatory environment, it shines as the second star of the year, offering potential similar to that revealed by China 15 years ago.” Though the comparison with China is sure to hurt the extreme patriot, she shall become forgiving on reading the mention in the next three year’s publications. In the 2007 report, the GRDI mentions, “India: talk turns to action. For the third year, India tops the Index as one of the most attractive countries for global retailers. India’s GDP is projected to grow by 9 percent in the fiscal year 2007—its highest
Applied Economics (HS 700) Course Project Report Vijay Gabale (07305004) Ashutosh Dhekne (07305016) Piyush Masrani (07305017) Sumedh Tirodkar (07305020) Tanmay Mande (07305051) March 19, 2008
1
Contents
1 Introduction 1.1 Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2 Objective . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Challenges Faced in Demand Forecasting 3 Theoretical Framework 3.1 Judgemental . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.2 Methods Requiring Quantitative Data . . . . . . . . . . . . . . . 4 Existing Surveys 5 Our Survey 6 Conclusion 3 3 4 4 6 6 7 8 12 14
2
Abstract The retail business in India is expanding in leaps and bounds. With increasing competition, each retailer needs to correctly cope up with the impending demand. The retail firms need to take into account various factors including the lead time and the seasonality of goods. In this report, we study the various techniques used by retailers in India to perform demand forecasting and analysis. We present a case study done at Lakewood Malls Pvt. Ltd. where we understand that historical data and judgemental techniques are primarily used for forecasting of demand.
1
Introduction
The A.T. Kearney Global Retail Development Index showed India on the sixteenth position in 1995. In 2004, the publication said, “Despite India’s stiff regulatory environment, it shines as the second star of the year, offering potential similar to that revealed by China 15 years ago.” Though the comparison with China is sure to hurt the extreme patriot, she shall become forgiving on reading the mention in the next three year’s publications. In the 2007 report, the GRDI mentions, “India: talk turns to action. For the third year, India tops the Index as one of the most attractive countries for global retailers. India’s GDP is projected to grow by 9 percent in the fiscal year 2007—its highest
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