Purchase contract management with demand forecast updates

Purchase Contract Management with Demand Forecast Updates

We study a two-stage purchase contract with a demand forecast update. The purchase contract provides the buyer an opportunity to adjust an initial commitment based on an updated demand forecast obtained at a later stage. An adjustment, if any, incurs a fixed as well as a variable cost. Using a dynamic programming formulation, we obtain optimal solutions for a class of demand distributions. We a...

A collaborative decentralized distribution system with demand forecast updates

Commodity Procurement with Demand Forecast and Forward Price Updates

Commodities, ranging from natural gas to memory chips, can be procured both by trading on the date in spot markets and in advance in forward markets. Transaction costs, such as brokerage fees, are typically higher in spot markets than in forward markets. Moreover, the forecast of a firm’s commodity requirement (demand) for a given future date typically changes in an uncertain fashion over time....

Forecast combination in revenue management demand forecasting

The domain of multi level forecast combination is a challenging new domain containing a large potential for forecast improvements. This thesis presents a theoretical and experimental analysis of different types of forecast diversification on forecast error covariances and resulting combined forecast quality. Three types of diversification are used: (a) diversification concerning the level of le...

Are forecast updates progressive?

Are forecast updates progressive? Chia-Lin Chang a,b,∗, Philip Hans Franses c, Michael McAleer c,d,e,f a Department of Applied Economics, National Chung Hsing University, Taichung, Taiwan b Department of Finance, National Chung Hsing University, Taichung, Taiwan c Econometric Institute, Erasmus School of Economics, Erasmus University Rotterdam, The Netherlands d Tinbergen Institute, The Netherl...