Net Forecast

Net Forecast is the final forecast for a Planning Entity (PE), which comprises of the system-generated forecasts for each enabled forecast Level, and Adjustments that are added (if available).

Adjustments can be added by the user in the PE or by the system when shared between the base PE and Aggregate Planning Entity (APE) levels.

The following describes examples for the calculation of Net Forecast.

This table lists the options and enabled levels of the forecast that are used in the examples:

Level Manual value Forecast engine Period type Periods used All periods Forecast retention periods
Freeze Yes None Weeks 2 3 1
Tactical No Default weekly Weeks 26 52 1
Strategic No Default Monthly Months 24 24 1

These are the various examples for determining Total System Forecast:

Example 1

This example explains how the net forecast is calculated when the Now Date is set to the Start of the Freeze Forecast and the end of the Tactical Forecast Periods Used coincides with the start of a complete month in the Strategic Forecast.

  • The Now Date is set to the start of the first week in Freeze Forecast Level.
  • The end of the Tactical Forecast Level 26 periods is followed by the start of a Strategic Forecast Level Month.
  • The Freeze level in which the All Periods option is set to 3 (weeks), and the Periods Used option is set to 2 (first two weeks) of the Total System Forecast.
  • The Tactical level in which the All Periods option is set to 52 (weeks) and the Periods Used option is set to 26 (weeks) of the total system forecast.
    Note: The first 2 weeks of the Total System Forecast are defined in the Freeze level, therefore, only Week 3 to Week 26 of Tactical Forecast is used in the Total System Forecast.
  • The Strategic level in which the All Periods and Periods Used option values is set to 24 (months).
    Note: 
    • The first 26 weeks (6 months) of the Total System Forecast are defined in the Freeze and Tactical levels, therefore, only Week 7 to Week 24 months (last 18 months) from Strategic is used in Total System Forecast.
    • Users can specify Adjustments after calculating Total System Forecast to generate Net Forecast.

Example 2

This example explains how the net forecast is calculated when the 26 weeks of Tactical Forecast completes in the middle of a month.

  • If the 26 weeks of Tactical are completed in the middle of a month (such as month 7 contains the 25, 26, 27, and 28 weeks), the first month of Strategic is used in the Total System Forecast contains only 2 weeks of Strategic Forecast (weeks 27 and 28). This is calculated as follows:
    • The Strategic month is converted to days based on the Interpolation Calendar specified during initialization.
    • The days are added to create the first month of Strategic Forecast in Total System Forecast, based on the days available in the first month, from the end of the Tactical Forecast. For example, Month 7 contains the summed values for Week 27 and Week 28.

Example 3

This example explains how the net forecast is calculated when the Now Date is in the middle of the week.

  • The Now Date is in the middle of the week (that is Day 5 of the first week), therefore, week 1 contains 3 days. The Total System Forecast for Week 1 is calculated as follows:
    • The Freeze week number for Week 1 is converted to days based on the Interpolation Calendar specified during initialization.
    • The days available for Week 1 are added, to determine the weekly value.
    • Week 2 value is considered from the Week 2 of Freeze Forecast value.