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A New Type of Combination Forecasting Method Based on PLS——The Application of It in Cigarette Sales Forecasting

Author(s): Biao Luo | Liang Wan | Wei-Wei Yan | Jie-Jie Yu

Journal: American Journal of Operations Research
ISSN 2160-8830

Volume: 02;
Issue: 03;
Start page: 408;
Date: 2012;
Original page

Keywords: PLS | ARMA | Time Series Method | Combination Forecasting Method | Sales Forecast

Cigarette market is a kind of monopoly market which is closed loop running, it depends on the plan mechanism to schedule producing, supplying and selling, but the “bullwhip effect” still exists. So it has a fundamental significance to do sales forecasting work. It needs to considerate the double trend characteristics, history sales data and other main factors that affect cigarette sales. This paper depends on the panel data of A province’s cigarette sales, first we established three single forecasting models, after getting the predicted value of these single models, then using the combination forecasting method which based on PLS to predict the province’s cigarette sales of the next year. The results show that the prediction accuracy is good, which could provide a certain reference to cigarette sales forecasting in A province.

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