Incorporating Time-Series Forecasting Techniques to Predict Logistics Companies’ Staffing Needs and Order Volume

Abstract

Time-series analysis is a widely used method for studying past data to make future predictions. This paper focuses on utilizing time-series analysis techniques to forecast the resource needs of logistics delivery companies, enabling them to meet their objectives and ensure sustained growth. The study aims to build a model that optimizes the prediction of order volume during specific time periods and determines the staffing requirements for the company. The prediction of order volume in logistics companies involves analyzing trend and seasonality components in the data. Autoregressive (AR), Autoregressive Integrated Moving Average (ARIMA), and Seasonal Autoregressive Integrated Moving Average with Exogenous Variables (SARIMAX) are well-established and effective in capturing these patterns, providing interpretable results. Deep-learning algorithms require more data for training, which may be limited in certain logistics scenarios. In such cases, traditional models like SARIMAX, ARIMA, and AR can still deliver reliable predictions with fewer data points. Deep-learning models like LSTM can capture complex patterns but lack interpretability, which is crucial in the logistics industry. Balancing performance and practicality, our study combined SARIMAX, ARIMA, AR, and Long Short-Term Memory (LSTM) models to provide a comprehensive analysis and insights into predicting order volume in logistics companies. A real dataset from an international shipping company, consisting of the number of orders during specific time periods, was used to generate a comprehensive time-series dataset. Additionally, new features such as holidays, off days, and sales seasons were incorporated into the dataset to assess their impact on order forecasting and workforce demands. The paper compares the performance of the four different time-series analysis methods in predicting order trends for three countries: United Arab Emirates (UAE), Kingdom of Saudi Arabia (KSA), and Kuwait (KWT), as well as across all countries. By analyzing the data and applying the SARIMAX, ARIMA, LSTM, and AR models to predict future order volume and trends, it was found that the SARIMAX model outperformed the other methods. The SARIMAX model demonstrated superior accuracy in predicting order volumes and trends in the UAE (MAPE: 0.097, RMSE: 0.134), KSA (MAPE: 0.158, RMSE: 0.199), and KWT (MAPE: 0.137, RMSE: 0.215).