Driver moderator method for retail sales prediction

摘要

A new method and a computer system to implement the method for SKU sales prediction in the presence of promotions for existing and new SKUs are introduced. These predictions are necessary for the retailer's order quantity decisions. Considering that the retailers are faced with shorter product life cycles and increasingly dynamic categories, they need tools that can cope with new SKUs and other changes in the category. The interpretability of the models is an important requirement for user acceptance of automated systems. The Driver Moderator method models are parsimonious and consistent across sister categories, and provide generalized insights across SKUs and stores into store, brand, SKU dynamics for various decisions such as category assortment or promotion planning.