Forecast Accuracy Formula: 4 Easy Calculations in Excel

How to Track & Improve Forecast Accuracy? 🎯

In my new YouTube Video, I released a step-by-step tutorial with 4 straightforward forecast accuracy formulas in Excel.

No matter if you forecast sales, new product launches, production demand...

My goal is for you to improve your forecast accuracy.

And make it simple to boost your performance.

As always, you can download an Excel template to start measuring forecast accuracy immediately with your company 🚀

Enjoy this video, and let me know how you track and improve your forecasting accuracy KPIs!

▬▬▬▬▬▬▬▬▬▬▬ CHAPTERS ▬▬▬▬▬▬▬▬▬▬▬▬

00:00 Intro
00:26 Why is Forecast Accuracy Important?
01:55 Have a Forecast
03:25 Define a Forecast Horizon
05:25 Save Historical Forecasts & Demand
08:24 Choose a Calculation Method
10:05 BIAS in Excel
11:52 MAE in Excel (Mean Absolute Error)
14:08 MAPE in Excel (Mean Absolute Percentage Error)
15:44 RMSE in Excel (Root Mean Square Error)
18:15 Forecast Accuracy Method Comparison
20:16 How to Improve Forecast Accuracy?

#demandforecasting #forecastaccuracy

[emilytran]

Thank you for your great work and tutorial. have just downloaded the file !!!!

[duffry]

2 notes:
1 - The Bias/accuracy illustration is really talking about precision on the x axis. The top right was precise but not accurate, bottom left was not biased or precise but it was accurate (on average).
2 - You are quite dismissive of MAPE but I think this shows your bias towards product supply - where each item has high value variability then MAPE loses relevance, however, in other contexts where value per item is essentially equal (such as call center demand forecasts) then MAPE is standard and with good reason.

[gabrielesaccardo]

I like the way you explain this complex subject! thanks

[Sheikh_Run_A]

Really very simple and amazing way u explained ❤

[chidanagalekshmi]

Thank you for the video! Is these topics covered in your inventory management expert course ?If not are you planning for any course related to forecasting and demand planning?

[rodocruz]

Thanks Edouard for this great video! You say Demand ≠ Sales and I understand this, but then what is the difference between demand and forecast if Demand ≠ Sales?

[patrykpec]

Thanks for good recording! Could you explain how to calculate the erros for more than one period of forecast? For example for wk32/wk33/wk34 (forecast updated few times) ... and compare these amounts to received/actual demand?

[rbxuuun]

Hi Edouard. How do you calculate % Accuracy with the MAE method if the actual sales is much lower than the forecast e.g. Forecast = 100, Actual Sales = 10. In that case the % Accuracy would be negative -800%. Do you cap it 0% in that case? How do you deal with negative values for % accuracy? Thanks

[SantoshDas-qcwj]

Hi Edourd, need your guidance how to measure forecast accuracy in case of a consumer fragnance businesses to businesses model

[gautamingale]

Hello, do you have excel file for the dashboard you mentioned at the end of video? Is it possible to share that as well? Thanks for the free excel by the way

[prasadtipnis]

How to connect with you on business using your tool

[vpudnsg]

What if over forecast. Say actually need 10 pc and I forecast 40 pc. The error is 30. error% is 300%. And accuracy is 200%???