Bell Inc. is a computer company that gets most of its component parts from suppliers in Southeast Asia, who ship to small warehouses called “revolvers” (for revolving inventory) near Bell’s main assembly plants near Fort Worth, Texas. Bell withdraws inventory for these warehouses every few hours, and most of Bell’s suppliers deliver to their revolvers every 3 or 4 days. One particular supplier provides most of the workings for the Bell Intrepid laptop, including the screen and keyboard, and the hard drive and mother board plus a few other parts are added at the assembly plant. These revolvers allow Bell to carry little of its own inventory by pushing it down to its suppliers. However, the supplier also wants to minimize its inventory, and one way it can do that is to develop an accurate demand forecast. Following is the supplier’s demand data (units) from Bell for the past 24 months:

Month Year 1 Demand Year 2 Demand January 2,447 2,561 February 1,826 1,733 March 1,755 1,693 April 1,456 1,484 May 1,529 1,501 June 1,633 1,655 July 2,346 2,412 August 3,784 4,017 September 4,106 3,886 October 3,006 2,844 November 2,257 2,107 December 3,212 3,410 Closely observe the demand data and develop a forecast model for year 3 that you believe will be accurate.

 LO.1