In forecasting demand for a product, it may be useful to forecast initial purchases and replacement purchases separately.

Question

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Initial purchases refer to the first-time purchases made by a customer, while replacement purchases refer to purchases made by existing customers to replace their worn-out or outdated products. Both types of purchases may have different demand patterns and drivers, and forecasting them separately can provide more accurate predictions of overall demand.

In Forecasting Demand for a Product, It May Be Useful