A system and method for forecasting sales is presented. A method might begin by receiving a request to produce a demand forecast for a stock keeping unit (SKU). Then, the SKU is placed in one or more clusters. A cluster seasonality profile is calculated for each of the one or more clusters. An item seasonality profile is calculated for the SKU. Then the demand forecast for the SKU is generated. The demand forecast is adjusted using the cluster seasonality profile for each of the one or more clusters and the item seasonality profile for the SKU. Then inventory can be ordered based on the adjusted demand forecast. Other embodiments are also disclosed herein.
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