Demand Forecasting is the process of finding patterns and trends in the historical sales data and making use of this knowledge to produce sales forecast for future time period.
There are often so-called outliers in the historical data, which do not follow the common patterns and trends. The outliers might be explained by external factors such as weather, holiday, events, offers, and campaigns. LS Forecast Dimensions allow you to define these external factors as additional dimensions.
The dimensions can be linked to either LS Forecast Locations or LS Forecast Items. You decide how the values for the dimensions are obtained, that is downloaded from external APIs or imported from files.
A Demand Forecasting engine can take the dimension data into consideration during the model calculation. If the dimensions prove to be relevant, decimal values called lift factors are produced, which represent the average effect of the dimensions on the sales. Positive lift factors mean that the external factors have a positive effect on the sales and negative lift factors indicate the opposite.
To set up Forecast Dimensions
- Click the
icon, enter LS Forecast Dimensions, and select the relevant link. - Click the New action to create a new dimension in your LS Central database.
- Fill in the relevant fields:
| Field | Description |
|---|---|
| Code | This field specifies the unique dimension code. The field cannot be blank and must only contain alphanumeric characters (A-Z and 0-9) without spaces. |
| Description | This field is a description of the dimension. |
| Linked To | This field specifies if this dimension is item-specific or location-specific. |
| Use Lift in Replen. Jrnl Calc. | This field specifies if the dimension's lift values are added to the base forecast quantity during the replenishment journal calculation and on the Replenishment Sales Chart. |
| API URL | This field specifies the external API's URL, from which the dimension entries will be downloaded. For example, you might want to download the rain or temperature forecast from a known API service provider. |
| API Access Key | This field specifies the external API's Access Key which allows the download of dimension entries. |
| API Parameter String | This field specifies the parameters that are required by the external API. You can specify many parameters, separated by a comma. |
See also
How to: Set Up Locations for Forecast
How to: Set Up Items for Forecast
How to: Set Up Forecast Dimension Entries
How to: Extend Forecast Dimensions