Managing lumpy demand for aircraft spare parts

Abstract

This paper deals with effective forecasting methods for typically lumpy demand for aircraft spare parts, and analyzes the behavior of forecasting techniques when dealing with lumpy demand. Twenty forecasting techniques are considered and tested and historical data from Alitalia are used to analyze and compare their performance. The results demonstrate that item lumpiness is the dominant parameter and show that demand forecasting for lumpy items is a complex problem; results from previous studies are not very accurate. The best approaches are found to be weighted moving averages, the Croston method, and exponentially weighted moving average models.