1. Inventory Management
  2. Demand Forecasting

Forecast Accuracy


Indicates how close the forecasted demand was to the actual demand. A higher accuracy reduces the chances of stockouts and excess inventory, helping in efficient inventory management.


[(1 - (Absolute Value (Actual Demand - Forecasted Demand) / Actual Demand)) x 100]


If the forecasted demand was 100 units and the actual demand was 110 units, the forecast accuracy is 90.91%.