# Hybrid Deep Learning Approach for Coupled Demand Forecasting and Supply Chain Optimization

arXiv: https://arxiv.org/abs/2604.21567 · HTML: https://mlsanity.com/paper/2604.21567/

## Key facts

- No citing papers in the map yet (data through 14 Oct 2026).
- Builds on 10 of its 32 references that are in the map.
- First posted on arXiv 23 Apr 2026.

## Builds on (most cited first, 10 of 10)

- [Informer: Beyond Efficient Transformer for Long Sequence Time-Series Forecasting](https://mlsanity.com/paper/2012.07436/) (2020)
- [A Time Series is Worth 64 Words: Long-term Forecasting with Transformers](https://mlsanity.com/paper/2211.14730/) (2022)
- [Are Transformers Effective for Time Series Forecasting?](https://mlsanity.com/paper/2205.13504/) (2022)
- [TimesNet: Temporal 2D-Variation Modeling for General Time Series Analysis](https://mlsanity.com/paper/2210.02186/) (2022)
- [Differentiable Convex Optimization Layers](https://mlsanity.com/paper/1910.12430/) (2019)
- [Time Series Forecasting With Deep Learning: A Survey](https://mlsanity.com/paper/2004.13408/) (2020)
- [Smart "Predict, then Optimize"](https://mlsanity.com/paper/1710.08005/) (2017)
- [From Predictive to Prescriptive Analytics](https://mlsanity.com/paper/1402.5481/) (2014)
- [A Survey of Contextual Optimization Methods for Decision Making under Uncertainty](https://mlsanity.com/paper/2306.10374/) (2023)
- [Comparing statistical and machine learning methods for time series forecasting in data-driven logistics -- A simulation study](https://mlsanity.com/paper/2303.07139/) (2023)

## Abstract (arXiv)

Supply chain resilience and efficiency are vital in industries characterized by volatile demand and uncertain supply, such as textiles and personal protective equipment (PPE). Traditional forecasting and optimization approaches often operate in isolation, limiting their real-world effectiveness. This paper proposes a Hybrid AI Framework for Demand-Supply Forecasting and Optimization (HAF-DS), which integrates a Long Short-Term Memory (LSTM)-based demand forecasting module with a mixed integer linear programming (MILP) optimization layer. The LSTM captures temporal and contextual demand dependencies, while the optimization layer prescribes cost-efficient replenishment and allocation decisions. The framework jointly minimizes forecasting error and operational cost through embedding-based feature representation and recurrent neural architectures. Experiments on textile sales and supply chain datasets show significant performance gains over statistical and deep learning baselines. On the combined dataset, HAF-DS reduced Mean Absolute Error (MAE) from 15.04 to 12.83 (14.7%), Root Mean Squared Error (RMSE) from 19.53 to 17.11 (12.4%), and Mean Absolute Percentage Error (MAPE) from 9.5% to 8.1%. Inventory cost decreased by 5.4%, stockouts by 27.5%, and service level rose from 95.5% to 97.8%. These results confirm that coupling predictive forecasting with prescriptive optimization enhances both accuracy and efficiency, providing a scalable and adaptable solution for modern textile and PPE supply chains.