A methodology for forecasting sugar demand : the case of Kenya National Trading Corporation (KNTC)

Abstract

KNTC plays a major role in the economy of this country. It is the main distributing agent of essential commodities from both domestic production and imports. The corporation handles provision and produce and hardware products. Like many other business organisations, KNTC faces problems in availing these products to the consumers in the right quantities at the right time. Among these problems include the sales forecast of these products, especially sugar. OR techniques could be utilized in solving this problem. It is within such a background that this study .was. initiated to see if KNTC' s sugar sales could be modeled using time series. The study developed forecasting models for sugar demand in 34 depots. In constructing these models, the researcher considered both technical and managerial aspects as viewed by KNTC management. The models were validated by using one year data. The models developed were found to be predicting demand for sugar fairly good. These models were validated by using one-year data and comparison between the predicted and the actual sugar demand for that year showed minimal variation. The need for an OR specialist in KNTC management has been recommended. Such a specialist would develop an efficient and effective sugar distribution system with the help of other officers of the corporation