The application of inventory forecasting methods and their implications : a case study on Costa Coffee Malta

Abstract

This paper shall endeavour to construct a theoretical substrate composed of forecasting techniques in the hope of developing a pragmatic and sustainable strategy for forecasting to avoid the indicated repercussions of negligent or fragile forecasting. An attempt will be made at compounding the human and mathematical techniques invoked in pertinent literature as strands of a single rope which bridges the manager in the present with the business situation in the future. Upon establishing the criteria from which an accurate forecasting method should flow from and the fluctuations which it must be sensitive to, a golden delineation between manager and model will result. This paper intends to engage this golden line in the mechanics of a case study based on a promising local business, Costa Coffee Malta. The results hereof will be contrasted with the intuitive technique presently employed, in order to ultimately decipher whether the introduction of discipline to forecasting is warranted or not. Finally, this paper will pinpoint considerations which must be imposed on both polar opposites of the forecasting spectrum to remain faithful to the golden thread. If results prove resonant with the bearing set in this paper, they will serve as an argument in favour of the integral theory of forecasting as expounded by Blattberg and Hoch.