How Brooks Brothers improved forecast accuracy

Apparel merchant Brooks Brothers used web-enabled software to boost forecast accuracy from 35% to 60% in its retail stores and from 27% to close to 100% in its outlet stores, the retailer says.

Don Davis

Forecasting demand can be most difficult for short-lifecycle, fashion-oriented items like apparel. But high-end apparel merchant Brooks Brothers has used web-enabled software to boost accuracy in forecasting demand over the past year from 35% to 60% in its retail stores and from 27% to close to 100% in its outlet stores, the retailer says.

“Our goal is to have 90-100% accuracy for every SKU, every store,” says Heidi Loncki, the retailer’s system administrator.

Brooks Brothers uses JDA Software Group Inc.’s web-enabled JDA Demand application within JDA’s Supply & Demand Optimization suite, incorporating technology from Manugistics, which JDA acquired last year. JDA Demand is designed with five statistical forecasting methods that consider separate data characteristics of individual products to forecast demand based on past sales, a process that can be most effective in forecasting consumer goods like paper towels that remain in the market for a long time, says Paula Natoli, product director of JDA’s demand and collaboration applications.

But retailers of products like consumer electronics and fashion apparel, which frequently change in features and styles, usually need additional means of forecasting demand, Natoli adds. “Sometimes there isn’t enough history for a mathematical solution to generate a forecast,” she says. “It’s like trying to find a pattern, but you can’t with only a few pieces of information. Then companies may want to use lifecycle or seasonality forecasting tools.”

Brooks Brothers uses JDA’s Seasonal Profiling application, which generates seasonal profiles for individual products to augment sales forecast data in JDA Demand. The seasonal profiles may figure seasonal fluctuations in demand, such as based on weather patterns, holiday periods or school schedules, and also apply these against local as well as regional or national markets. Combined with the general sales forecasts, the seasonal profiles led to the sharp increases in forecast accuracy at Brooks Brothers, Loncki says. “We substantially increased forecasting accuracy with the new profiles,” she says in a webcast on JDA’s web site.

Brooks Brothers is No. 320 in the Internet Retailer Top 500 Guide.


business finance, Forecasting, JDA Software, Management, Manugistics