Case Article–Canyon Bicycles: Judgmental Demand Forecasting in Direct Sales

Case Article–Canyon Bicycles: Judgmental Demand Forecasting in Direct Sales

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Article ID: iaor2017303
Volume: 17
Issue: 2
Start Page Number: 58
End Page Number: 62
Publication Date: Jan 2017
Journal: INFORMS Transactions on Education
Authors: ,
Keywords: demand, forecasting: applications, education in OR, education, simulation, e-commerce
Abstract:

We present a comprehensive introduction to judgmental demand forecasting along with a model that allows for effectively debiasing team forecasts and estimating demand distributions. This case is recommended for classes in operations management, marketing, or retail management; two companion papers are ideal for advanced courses (e.g., master’s or doctorate programs). We confront students with a demand forecasting problem encountered by Canyon Bicycles, the German premium bicycle manufacturer and online retailer. We present both a model and a process for deriving an accurate judgmental demand forecast. In particular, we demonstrate how one can (i) identify the best team composition, (ii) prepare for and run the forecasting meeting, (iii) debias team forecasts, (iv) estimate demand distributions, (v) deal with heterogeneous product collections, and (vi) judge the quality of forecasted demand distributions.

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