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When it comes to aggregation you could traditionally choose top-down or bottom-up. That is not necessarily the case anymore.

The Institute of Business Forecasting & Planning said, “Middle-out forecasting is another option, starting somewhere in the middle of a hierarchy; for example, from a specific product line or category. Others prefer a hybrid approach, forecasting some items at lower levels and others aggregated. It is clear that often, forecasts can and should be done and multiple levels of aggregation.�

No matter which method you use, it’s important to use this tool to make your forecasting more accurate. Which method would work best for you?