Exponential Smoothing

Exponential Smoothing (ES) evaluates the basic demand patterns of Level, Trend, and Seasonality and projects these into the future. They are labelled smoothing since they use weighted averages on historic data, and the weighting decays exponentially as we go back in time: more recent data is weighted more heavily than past data.

Figure 12-1 Demand Patterns of Level, Trend, Seasonality