Case Study
Price Forecasting for Selected Product Segments
Problem
- The client wanted to understand the trends and drivers for the demand of certain product segments to allow them to dynamically adjust prices and maximize revenues.
- Before, prices were set by the country salespeople based on their domain knowledge, but without a systematic understanding of the patterns impacting prices.
Approach
- We started the project by conducting a thorough exploration and analysis of the internal and external data impacting demand, sales, order intake, and prices. The phase also included many discussions with the salespeople.
- We then applied and tested several AI-modeling approaches and selected the best-performing model.
- Once the AI-model was tested, we productized all the data pipelines and the AI model into the client’s environment and operative systems.
Results
Salespeople can access and test out the forecasting results via a scenario tool as follows: forecasting (2-7-month-forecasts) and performance (forecasts compared with realized prices).
Business Value
Sales, Pricing, Inventory Management.
Tech & Methods
Client
Forestry Company
The client is a leading producer of wood-based bioproducts, such as pulp, sawn timber, biochemicals and bioenergy. Their products are known for their high quality, which is based on the unique characteristics of Nordic wood.
