The Alpha α value is higher the damping factor is smaller.Resultant the more the peaks and valleys are smoothed out. The Alpha α value is smaller the damping factor is higher.Now, if we compare the results of all the above 3 Excel Exponential Smoothing examples, then we can come up with the below conclusion: Let’s consider α=0.8 for the above-given data values so enter the value 0.2 in the Damping Factor box and again repeat the Exponential Smoothing method. Let’s consider α=0.2 for the above-given data values so enter the value 0.8 in the Damping Factor box and again repeat the Exponential Smoothing method.Įxponential Smoothing Forecasting – Example #3 The graph doesn’t calculate the smoothed value for the first data point because there is no data point before that.Įxponential Smoothing Forecasting – Example #2.The above graph is showing an increasing trend in the data points.Here α=0.1, the previous data point is given a relatively small weight, whereas the previous smoothed value is given a large weight (0.9).It will insert the damping values in the E column with the Exponential Smoothing chart, as shown in the below screenshot.Tick on Chart Output box for displaying the values in the chart and then click on OK.Under the Output Range box, select the cell where you want to see the result.This 0.9 is called the damping factor, which is equal to the 1- α. In the Damping Factor box, enter the value 0.9.Under the Input Range box select, the Price values range from C4:C15.

A dialog box appears for the Exponential Smoothing method.

Let’s understand the working of forecasting Exponential Smoothing in Excel with some examples. How to Use Exponential Smoothing in Excel?Įxponential Smoothing in Excel is very simple and easy to use.

The above steps will add the Data Analysis section for statistical analysis under the DATA tab.

Tick on the Analysis Toolpak checkbox and then click on OK, as shown in the below screenshot.

(However, Excel Add-Ins is by default selected)

Select the Excel Add-Ins options under Manage Box and click on the Go button as shown in the below screenshot.

Click on the Add-Ins tab, as shown in the below screenshot.

It will open a dialog box for Excel Options.

Click on the OPTIONS tab in the left pane window. To add this feature in Excel, follow the below steps: We need to add this feature in Excel for analyzing business by using Excel Add-Ins. Steps to load the Analysis ToolPak add-in:

TEXT and String Functions in Excel (26+).

Lookup and Reference Functions in Excel (36+).

Excel Conditional Formatting in Pivot Table.

How to add forecast sheet in excel mac