Forecast - Forecast - Seasonality

Sets the threshold for identifying seasonal demand. A setting of “High” will result in more forecasts being recognized as seasonal than “Low,” but may reduce accuracy in certain cases.

For businesses that operate in a very flat forecast industry, such as hardware or groceries, apply a setting of Low.

For businesses with a large proportion of seasonal items, such as those selling outdoor products or seasonal sports goods, apply a setting of High.

For the average business, a setting of Medium is generally appropriate.

💡Tip: Leave these settings at their default values initially. Allow demand planners to forecast as usual, review where forecasts fall short, and adjust this parameter based on those findings.

The Advanced Forecasting module can detect and apply seasonality for groups of items, producing more seasonal forecasts that are not affected by the random variability often seen in individual product sales histories.

This parameter determines how readily the forecast model assumes an item is seasonal.

Below are examples showing how each setting affects the forecast for different sales patterns:

"Seasonal"-looking forecast, "Low" seasonality setting

"Seasonal"-looking forecast, "High" seasonality setting

Flat-looking forecast, "Low" seasonality setting

Flat-looking forecast, "High" seasonality setting

In simple terms, a High setting may identify seasonality where little exists, while a Low setting may overlook genuine seasonal trends.

These examples are for illustration only and do not represent the exact calculations performed in the app.