International Journal of Emerging Trends & Technology in Computer Science (IJETTCS)

Web Site: www.ijettcs.org Email: editor@ijettcs.org

Volume 5, Issue 1, January - February 2016
ISSN 2278-6856

Intelligent System Using Support Vector

Regression for Demand Forecasting
Kausar S. Attar
Vidyalankar Institute of Technology, Department of Computer Science, Mumbai University,
Vidyalankar College Marg,Wadala East,Mumbai,Maharashtra 400037

ABSTRACT: Supply chain management (SCM) is an emerging

field that has commanded attention from different
communities. On the one hand, the optimization of supply
chain which is an important issue, requires a reliable
prediction of future demand. On the other hand, It has been
shown that intelligent systems and machine learning
techniques are useful for forecasting in several applied
domains. In this paper, they used the Particle Swarm
Optimization (PSO) algorithm to optimize the SVR
parameters. Furthermore, we will use the Artificial Bee
Colony (ABC) algorithm to optimize the SVR parameters.
Furthermore, We will investigate the time complexity of SVRPSO and SVR-ABC for supply chain demand forecasting by
comparing these two algorithms.

Keywords: Forecasting, supply chain management,

support vector regression, particle swarm optimization.

1. INTRODUCTION
1.1 Overview
This work examines a theory approach applied on a basic
supply chain involving a set of products with probabilistic
demand. It can be used to maximize profit by trying to
find a local optimum which leads to a loss of performance
for the whole chain. Managing supply chain includes
coordinating its different flows (products, finances and
information flows) among and within companies. The
main objective of any effective supply chain management
(SCM) system is to satisfy the customer demand with the
minimum costs; In our case we focus on optimizing
inventory costs by using the information flow, more
precisely on sharing information within the supply chain.
By sharing information SCM have the possibility to allow
in the supply chain to: - Better plan for their future needs
in order to satisfy costumers and achieve a competitive
advantage. - Improve the time-to-market of products. Reduce costs.
We present demand forecasting approach adopted. Then,
the supply chain proposed with a method to present the
probabilistic demand.

2. LITERATURE SURVEY
A review of Intelligent System Using Support Vector
Regression For Demand Forecasting includes many
aspects such as scope, features to be provided in the
proposed System, user perception for using the System,
benefits of proposed System etc. Literature Review

Volume 5, Issue 1, January February 2016

specifically elaborates Technical Paper Review, Summary

of Analysis, Advantages, Disadvantages and Techniques
Used in that papers.
2.1 Technical Paper Review
2.1.1 Intelligent System Based Support Vector
Regression[1].
Supply chain management (SCM) is an emerging field
that has commanded attention from different
communities. On the one hand, the optimization of supply
chain which is an important issue, requires a reliable
prediction of future demand. On the other hand, It has
been shown that intelligent systems and machine learning
techniques are useful for forecasting in several applied
domains. In this paper, we introduce the machine learning
technique of time series forecasting Support Vector
Regression (SVR) which is nowadays frequently used.
Furthermore, we use the Particle Swarm Optimization
(PSO) algorithm to optimize the SVR parameters.
2.1.2 Application of machine learning techniques for
supply chain demand forecasting [2].
In this paper, investigate the applicability of advanced
machine learning techniques, including neural networks,
recurrent neural networks, and support vector machines,
to forecasting distorted demand at the end of a supply
chain (bullwhip effect). We compare these methods with
other, more traditional ones, including naive forecasting,
trend, moving average, and linear regression. We use two
data sets for our experiments: one obtained from the
simulated supply chain, and another one from actual
Canadian Foundries orders. Our findings suggest that
while recurrent neural networks and support vector
machines show the best performance, their forecasting
accuracy was not statistically significantly better than that
of the regression model.
2.1.3 Demand Forecasting of Supply Chain Based on
Support Vector Regression Method [3].
Introducing the basic theory and computing process of
time series forecasting based on Support Vector
Regression (SVR) in details, optimizing the parameters of
SVR. Applying SVR to forecast the demand of supply
chain in real data, and compared to the RBF neural
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International Journal of Emerging Trends & Technology in Computer Science (IJETTCS)

Web Site: www.ijettcs.org Email: editor@ijettcs.org
Volume 5, Issue 1, January - February 2016
ISSN 2278-6856
network method. The result shows that SVR is superior to
RBF in prediction performance. And SVR is the suitable
and effective method for demand forecasting of supply
chain.
2.1.4 DEMAND FORECASTING USING NEURAL
NETWORK FOR SUPPLY CHAIN MANAGEMENT
[4].
The demand forecasting technique which is modeled by
artificial intelligence approaches using artificial neural
networks. The consumer product causers the difficulty in
forecasting the future demand and the accuracy of the
forecast In performance of the artificial neural network an
advantage in a constantly changing business environment
and demand forecasting an organization in order to make
right decisions regarding manufacturing and inventory
management. The learning algorithm of the prediction is
also imposed to better prediction of time series in future.
The prediction performance of recurrent neural networks a
simulated time series data and a practical sales data have
been used. This is because of influence of several factors
on demand function in retail trading system.
2.1.5 A Hybrid Particle Swarm Optimization and
Support Vector Regression Model for Financial Time
Series Forecasting [5].
A time series forecasting approach by integrating particle
swarm optimization (PSO) and support vector regression
(SVR) is proposed. SVR has been widely applied in time
series predictions. However, no general guidelines are
available to choose the free parameters of an SVR model.
The proposed approach uses PSO to search the optimal
parameters for model selections in the hope of improving
the performance of SVR. In order to evaluate the
performance of the proposed approach, the TAIEX
(Taiwan Stock Exchange Capitalization Weighted Stock
Index) closing cash index is used as the illustrative
example. Experimental results show that the proposed
model outperforms the traditional SVR model and
provides an alternative in financial time series forecasting.
2.1.6 Data Mining and Data Ware housing for Supply
Chain Management [6].
Supply Chain Management (SCM) plays a very vital role

in managing and organizing enterprise processes,

increasing operational efficiency of the organization.
Factors such as product success, customer satisfaction,
successful organize execution of Supply Chain
Management (SCM). Supply chain management is
becoming a necessity to improve the foundation and
infrastructure within societies which in turn increases the
economic growth, living standard of society also. The
research findings indicate that although it seems that
SCM provides many services, but it has some issues too;
which includes poor inventory management, bullwhip
effect, High cost of logistics, technology usage and
inadequate investments in IT. To overcome issues of SCM
there is a need of an improved sales forecasting model
which will build the reliable and efficient forecasting
results.
2.1.7 Improved supply chain management based on
hybrid demand forecasts [7].
Demand forecasts play a crucial role for supply chain
management. The future demand for a certain product is
the basis for the respective replenishment systems. Several
forecasting techniques have been developed, each one with
its particular advantages and disadvantages compared to
other approaches. This motivates the development of
hybrid systems combining different techniques and their
respective strengths. In this paper, we present a hybrid
intelligent system combining Autoregressive Integrated
Moving Average (ARIMA) models and neural networks
for demand forecasting.
2.1.8 Evaluation of coordination contracts for a two
stage Supply Chain under price dependent demand[8].
Supply chains are characterized by many activities and
actors that generally pursue conflicting objectives.
Coordination between them may be then necessary to
align the individual objectives with the global supply
chain objective and achieve optimal performance. In this
paper, we propose a model that aims to assess the relative
performance of three well known Coordination Contracts
for a two level Supply Chain under price dependent
demand. It is shown that a suitable design of the contracts
could secure global system efficiency and improve the
profit of all the Supply Chain actors.

3. DISCUSSION/ANALYSIS
SR
NO.

RESEARCH PAPER
NAME

1.

Intelligent System Based

Support
Vector
Regression For Supply
Chain
Demand
Forecasting [1]

2.

Application of machine
learning techniques for
supply chain demand
forecasting[2]

DISADVANTAGE

ADVANTAGE

TECHNIQUE
USED

In this paper we investigate

the applicability of the hybrid
machine learning technique
SVR-PSO to forecast Supply
Chain demand. We compare
it with the SVR-GA model.
- The objective of this
research was to study the
effectiveness of forecasting
the distorted demand signals

the choice of algorithms such as

PSO can be important to improve
the accuracy of choosing the W
parameter of the SVR model..

SVR
-PSO
SVR
-GA

The performance of RNN, SVM,

NN have been significantly better
than that
of the simpler techniques

- Recurrent
Neural
Networks
(RNN) and

Volume 5, Issue 1, January February 2016

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International Journal of Emerging Trends & Technology in Computer Science (IJETTCS)

Web Site: www.ijettcs.org Email: editor@ijettcs.org
Volume 5, Issue 1, January - February 2016
ISSN 2278-6856
in the extended supply chain
with advanced non-linear
machine learning techniqus.

including
moving
average,
nave, and trend methods.

3.

Demand Forecasting of
Supply Chain Based on
Support
Vector
Regression Method[3]

Compared with the RBF

neural network results, the
paper apply the support
vector regression method
to predict the supply chain
needs.

Compared with the RBF neural

networks,
support
vector
regression method shows the
smaller results of the relative
mean square error, higher
forecast accuracy in an instance
of the supply chain needs.

4.

DEMAND
FORECASTING USING
NEURAL
NETWORK
FOR SUPPLY CHAIN
MANAGEMENT[4].

- Train LM method performs

more effectively than the other
tanning method and the more
reliable forecast for our case. The
proposed methodology can be
considered as a successful
decision
support
Tool
in
forecasting.

5.

A Hybrid Particle Swarm

Optimization and Support
Vector Regression Model
for Financial Time Series
Forecasting[5].

- This study has developed a

cooperative
forecasting
mechanism based on ANN
and training methods. The
proposed
methodology,
demand forecasting issue
was investigated on a
manufacturing company as a
real-world case study.
- This study compared the
forecasting results of the
proposed method with those
of the traditional SVR
method using prediction
error and prediction accuracy
as criteria

6.

Data Mining and Data

Warehousing for Supply
Chain Management[6]

- K-SVM outperforms the

SVM, ANN and Nave
model in various accuracy
measures such as MAPE,
MAD and MSE.

7.

Improved supply chain

management based on
hybrid
demand
forecasts[7].

8.

Evaluation
of
coordination contracts for
a two stage
Supply Chain under price
dependent demand[8].

- a hybrid intelligent system

for demand forecasting that
helps to improve supply
chain management in the
retail industry. Providing
advanced forecasts in a
supermarket
allows
all
agents of the respective chain
to better manage their
inventory decisions.
This paper has addressed the
problem of coordination
under the hypothesis of
decentralized control and
price dependent demand for
a two level Supply Chain.

Volume 5, Issue 1, January February 2016

Support
Vector
Machines
(SVM)
-NEUR
AL
NET
WORK
SUPPORT
VECT
OR REG
RESSION
Artificial
Neural
Network

- the proposed PSO-SVR model

can produce lower prediction
error and higher prediction
accuracy in the datasets. Besides,
the CPU time for the proposed
model is about eight times faster
than that when using the
traditional SVR method.
K-SVM require less time to
optimally train and gives more
consistent and accurate results as
compared to ANN and SVM due
to optimization of threshold
functions. ANN gives improved
performance if numbers of
iterations are increased with less
prediction errors.
- Regarding forecast accuracy,
neural networks outperformed
ARIMA models and the proposed
additive hybrid approach gave
best results.

-SVR
PSO

a proper
design of the coordination
contracts could be a convincing
incentive for the Supply Chain
actors to adopt them.

Revenue
Sharing
Contract
Quantity
Discount
Contract

-SVM
Artificial
Neural
Network
(ANN)

-ARIMA
model

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International Journal of Emerging Trends & Technology in Computer Science (IJETTCS)

Web Site: www.ijettcs.org Email: editor@ijettcs.org
Volume 5, Issue 1, January - February 2016
ISSN 2278-6856
4. CONCLUSION
In this paper I have discussed different literature survey
and I have got very important and helpful knowledge from
these literature survey for further work.

REFERENCES
[1] Malek Sarhani & Abdellatif El Afia Intelligent
System
B
Regression
For
Supply Chain
DemandIn.978-1-4799-4647Forecasti1/14/$31.00
2014 IEEE
[2] Real Carbonneau, Kevin Laframboise and Rustam
Vahidov Application of learning techniques for
supply
chain
demand
forecastingIn.EuropeanJournalof
Operational
Research 184 (2008) 11401154
[3] WANG Guanghui Demand Forecasting of Supply
Chain Based on Support Vector Regression Method
In2012.International Workshop on Information and
Electronics Engineering (IWIEE)
[4] Ashvin Kochak1 andSuman Sharma1 Demand
Forecasting USING NEURAL NETWORK FOR
SUPPLY CHAIN MANAGEMENT InISSN.2278
0149 www.ijmerr.com Vol. 4, No. 1, January 2015
2015 IJMERR.
[5] Horng-I Hsieh and Tsung-Pei Lee A Hybrid Particle
Swarm Optimization and Support Vector Regression
Model for Financial Time Series Forecasting In.
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[6] Shridhar Kamble*, Aaditya Desai and Priya Vartak
Data Mining and Data Warehousing for Supply Chain
Management In2015, Information & Computing
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[7] Luis Aburto a, Richard Weber Improved supply chain
management based on hybrid demand forecasts
In1568.-4946/$ see front matter # 2005 Published by
Elsevier B.V.doi:10.1016/j.asoc.2005.06.001
[8] Noureddine Labiad1, Zitouni Beidouri1, Otmane
Bouksour1 Evaluation of coordination contracts for a
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(Online): 1694-0814.

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