Measure forecast accuracy using absolute, squared and percentage error metrics.
MAE and RMSE both measure magnitude but RMSE punishes large misses harder. Bias is the signed average and is the only one of the three that detects systematic error. A forecast can have low MAE and severe bias, which matters enormously for inventory where persistent under-forecasting causes stockouts.
Forecast Error
MAE averages absolute errors; RMSE averages squared errors; bias averages signed errors
MAE averages absolute errors; RMSE averages squared errors; bias averages signed errors MAE and RMSE both measure magnitude but RMSE punishes large misses harder. Bias is the signed average and is the only one of the three that detects systematic error.
A forecast can have low MAE and severe bias, which matters enormously for inventory where persistent under-forecasting causes stockouts.
This calculator takes 6 inputs: Actual period 1, Forecast period 1, Actual period 2, Forecast period 2, Actual period 3, Forecast period 3. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.