To calculate the next forecast, you use the weighted average form of the exponential smoothing formula: Ft+1=αAt+(1−α)Ft. With a smoothing constant of α=0.2, the formula becomes Ft+1=0.2(At)+0.8(Ft).
Conditions: The smoothing constant is α=0.2.; You know the actual sales value for the current period (At).; You know the forecast value for the current period (Ft).
To calculate the next forecast, you use the weighted average form of the exponential smoothing formula: Ft+1=αAt+(1−α)Ft. With a smoothing constant of α=0.2, the formula becomes Ft+1=0.2(At)+0.8(Ft).
Conditions: The smoothing constant is α=0.2.; You know the actual sales value for the current period (At).; You know the forecast value for the current period (Ft).