System, method and computer program for improved forecasting residual values of a durable good over time
A residual value forecasting system may utilize heterogeneous data, such as used market data, industry-specific data, and non-industry-specific data, from disparate data sources to produce residual value forecasts of an item based on a sophisticated residual value forecasting model particularly configured for agility. The system can dynamically and quickly adapt to change in data inputs and produce custom outputs. The system may determine a baseline value for an item using the used market data, a microeconomic factor using the industry-specific data, and a macroeconomic factor using the non-industry-specific data, as well as adjustments such as locality adjustments and modifications. Given the macroeconomic factor and the microeconomic factor relative to the locality-adjusted value of the item and in view of the competitive sets of similar and/or substitute items in the same industry, the system can generate an accurate forecast residual value of the item at a future time point.
1. A method for generating forecasts of residual values of an item of interest in an industry, the method comprising:
programmatically receiving or obtaining, from disparate data sources by a system executing on a processor and operating in an enterprise computing environment, used market data, non-industry-specific data, and industry-specific data;
applying, by the system, the used market data, the non-industry-specific data, and the industry-specific data to a residual value forecasting model, the residual value forecasting model having:
a first computational component driven by a baseline value for the item of interest, the first computational component having a baseline value variable for representing the baseline value for the item of interest with a base configuration at an initial time point;
a second computational component driven by macroeconomic factors not specific to the industry, the second computational component having a macroeconomic factor represented by a linear combination of macroeconomic variables that represent macroeconomic features under consideration for the item of interest in future time periods after the initial time point; and
a third computational component driven by microeconomic factors specific to the industry, the third computational component having a microeconomic factor represented by a linear combination of microeconomic variables that represent microeconomic features specific to the industry in future time periods after the initial time point, wherein the microeconomic features specific to the industry include a brand value that corresponds to a level of a brand trending in the used market data;
wherein the applying produces a forecasted residual value for the item of interest at a future time point; and
providing, from the system to a computing device, the forecasted residual value for the item of interest at the future time point.
2. The method according to claim 1 , further comprising:
determining the brand value using the used market data, the determining including identifying a rank order of the brand among brands in the used market data.
3. The method according to claim 1 , wherein the used market data includes open auction data and wherein the disparate data sources include a data source that provides the open auction data.
4. The method according to claim 1 , wherein the disparate data sources include a data storage device internal to the enterprise computing environment and a data storage device external to the enterprise computing environment.
5. The method according to claim 1 , further comprising:
receiving a request for a residual value forecast, the request including a specified time period and information on a vehicle having a year, make, and model, wherein the applying is performed in response to the request from the computing device, wherein the item of interest corresponds to the vehicle having the year, make, and model, and wherein the specified time period includes the future time point.
6. The method according to claim 1 , wherein the applying is performed in response to an instruction or command from an administrator of the system, automatically by a programmed trigger, or automatically per a scheduled event.
7. The method according to claim 1 , further comprising:
pushing the forecasted residual value for the item of interest at the future time point to a plurality of computing devices owned and operated by different entities.
8. A system for generating forecasts of residual values of an item of interest in an industry, the system operating in an enterprise computing environment and comprising:
a processor;
a non-transitory computer-readable medium; and
stored instructions translatable by the processor for:
programmatically receiving or obtaining, from disparate data sources, used market data, non-industry-specific data, and industry-specific data;
applying the used market data, the non-industry-specific data, and the industry-specific data to a residual value forecasting model, the residual value forecasting model having:
a first computational component driven by a baseline value for the item of interest, the first computational component having a baseline value variable for representing the baseline value for the item of interest with a base configuration at an initial time point;
a second computational component driven by macroeconomic factors not specific to the industry, the second computational component having a macroeconomic factor represented by a linear combination of macroeconomic variables that represent macroeconomic features under consideration for the item of interest in future time periods after the initial time point; and
a third computational component driven by microeconomic factors specific to the industry, the third computational component having a microeconomic factor represented by a linear combination of microeconomic variables that represent microeconomic features specific to the industry in future time periods after the initial time point, wherein the microeconomic features specific to the industry include a brand value that corresponds to a level of a brand trending in the used market data;
wherein the applying produces a forecasted residual value for the item of interest at a future time point; and
providing, from the system to a computing device, the forecasted residual value for the item of interest at the future time point.
9. The system of claim 8 , wherein the stored instructions are further translatable by the processor for:
determining the brand value using the used market data, the determining including identifying a rank order of the brand among brands in the used market data.
10. The system of claim 8 , wherein the used market data includes open auction data and wherein the disparate data sources include a data source that provides the open auction data.
11. The system of claim 8 , wherein the disparate data sources include a data storage device internal to the enterprise computing environment and a data storage device external to the enterprise computing environment.
12. The system of claim 8 , wherein the stored instructions are further translatable by the processor for:
receiving a request for a residual value forecast, the request including a specified time period and information on a vehicle having a year, make, and model, wherein the applying is performed in response to the request from the computing device, wherein the item of interest corresponds to the vehicle having the year, make, and model, and wherein the specified time period includes the future time point.
13. The system of claim 8 , wherein the applying is performed in response to an instruction or command from an administrator of the system, automatically by a programmed trigger, or automatically per a scheduled event.
14. The system of claim 8 , wherein the stored instructions are further translatable by the processor for:
pushing the forecasted residual value for the item of interest at the future time point to a plurality of computing devices owned and operated by different entities.
15. A computer program product for generating forecasts of residual values of an item of interest in an industry, the computer program product having a non-transitory computer-readable medium storing instructions translatable by a system having a processor and operating in an enterprise computing environment, the instructions when translated by the processor perform:
programmatically receiving or obtaining, from disparate data sources, used market data, non-industry-specific data, and industry-specific data;
applying the used market data, the non-industry-specific data, and the industry-specific data to a residual value forecasting model, the residual value forecasting model having:
a first computational component driven by a baseline value for the item of interest, the first computational component having a baseline value variable for representing the baseline value for the item of interest with a base configuration at an initial time point;
a second computational component driven by macroeconomic factors not specific to the industry, the second computational component having a macroeconomic factor represented by a linear combination of macroeconomic variables that represent macroeconomic features under consideration for the item of interest in future time periods after the initial time point; and
a third computational component driven by microeconomic factors specific to the industry, the third computational component having a microeconomic factor represented by a linear combination of microeconomic variables that represent microeconomic features specific to the industry in future time periods after the initial time point, wherein the microeconomic features specific to the industry include a brand value that corresponds to a level of a brand trending in the used market data;
wherein the applying produces a forecasted residual value for the item of interest at a future time point; and
providing, from the system to a computing device, the forecasted residual value for the item of interest at the future time point.
16. The computer program product of claim 15 , wherein the instructions are further translatable by the processor for:
determining the brand value using the used market data, the determining including identifying a rank order of the brand among brands in the used market data.
17. The computer program product of claim 15 , wherein the disparate data sources include a data storage device internal to the enterprise computing environment and a data storage device external to the enterprise computing environment.
18. The computer program product of claim 15 , wherein the instructions are further translatable by the processor for:
receiving a request for a residual value forecast, the request including a specified time period and information on a vehicle having a year, make, and model, wherein the applying is performed in response to the request from the computing device, wherein the item of interest corresponds to the vehicle having the year, make, and model, and wherein the specified time period includes the future time point.
19. The computer program product of claim 15 , wherein the applying is performed in response to an instruction or command from an administrator of the system, automatically by a programmed trigger, or automatically per a scheduled event.
20. The computer program product of claim 15 , wherein the instructions are further translatable by the processor for:
pushing the forecasted residual value for the item of interest at the future time point to a plurality of computing devices owned and operated by different entities.