03_LO525_Reorder Point and Store Location Planning.doc

8/12/2019 03_LO525_Reorder Point and Store Location Planning.doc

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Chapter 2 Reorder Point and Storage Location

Planning

Reorder point planning

Ordering procedure for external procurement

Storage location MRP


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Chapter 2 Objectives

you will know the business background for reorder

point planning

you will have learned the reorder point planning

procedure in the SP system !net re"uirements

calculation# lot$si%e calculation&

you will know the options you have in the R'( system

for organi%ing the link between materials planning

and purchasing

you will have learned the functions available in

storage location MRP

)y the end of this chapter*


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Reorder Point Planning

Replenishment

lead time

Stock Lot si%e

Reorder point

Safety stock

Reorder point Point of delivery +ime

The basis of reorder point planning is the comparison of stock and firmed receipts with the reorder point.

The reorder point should cover consumption quantities during the replenishment lead time.

If stock levels fall below the reorder point, procurement is triggered for the amount of the lot size.

Safety stock is used to cover unplanned requirements during the replenishment lead time. It forms a part of thereorder point stock.

If sales orders and manual reservations are to be included in planning, a separate reorder point procedure isavailable with eternal requirements!.


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,et Re"uirements -alculation for Reorder Point

Planning

Reorder point

Purchase orders

.irmed planned orders

.irmed purchase

re"uisitions

Order proposal for

lot si%e "uantity

Stock

Shortage

-omparison

" material shortage eists, when total stock plus firmed order proposals is less than the reorder point.

If a material shortage eists, procurement is carried out for the amount of the lot size.


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Reorder Point Planning* .orward Scheduling

for /xternal Procurement

Today (release date) Delivery date MRP date

Processing time for

prchasing Planned delivery time

Goods receipt

processing time

In forward scheduling, to determine the #$% date &that is, the date by which the material is to be available for

processing', the system starts from the date of the planning run and calculates in the future.

In forward scheduling, starting from today(s date, the system adds the processing time required by thepurchasing department, then the planned delivery time in calendar days and finally the goods receipt processingtime in workdays.


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Ordering Procedure for /xternal Procurement

0ork list for

purchasing

Prchaseorder

Plannedorder

Schedlingagreement

!"#"$%

!"&"$%

Prchasere'isition

Manal

Materials PlanningMaterials Planning

Pr"Re'"

Pr"Re'"

Pr"Re'"

Prchasere'isition

Atomatic

)epending on the link between materials planning and purchasing, the work lists of both departments can be

separated.

%lanned orders can also be created for eternal procurement so that the #$% controller can coordinate plannedquantities and dates in materials planning before they are passed on to the purchasing department.

*owever, purchase requisitions can also be created directly in the planning run.

In purchasing, the purchase requisitions created in the planning run can automatically be converted intopurchase orders.

If a scheduling agreement eists for the vendor, schedule lines can also be created directly in the planning run.


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1etermining Source of Supply via Source List

1etermining source of supply1etermining source of supply

Sched2agmt

!"%"$

!"#"$

3uota

arrangements

3uota3uota

arrangementsarrangements

4endor

)* 567* 867

Source list

/xactly one valid

entry for materials planning

Reference to scheduling

agreements and automaticschedule lines allowed

Schedule lines created

during the planning run

Source list

+hen planning eternally procured materials, the source of supply can be determined using the source list or by

quota arrangements.


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Storage Location MRP !9&

Stock shortage in separately

planned storage location

Stock transfer reservation in plant

Replenishment per stock transfer

between storage locations

Stock transfer

between storagelocations

Plant 9666

Storagelocationsplanned inplant

Storagelocationplannedseparately

Procedure* stock transfer within a plant

In inventory management, the transfer posting to the storage location planned separately is carried out with

reference to a stock transfer reservation.


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Storage Location MRP !:&

Stock shortage in separately


Procurement directly for separately

planned storage location !in$house

production'external

procurement'consignment&

;oods receipt directly for the separately


Plant 9666Plant 9666

Storage locationsplanned in plant

Storage locationplanned separately

Procedure* separate procurement for the storage location

Procurementand ;R posting

Procurementand ;R posting

The special procurement keys for storage location #$% &eternal procurement, inhouse production, stock

transfer from another plant' are defined in -ustomizing.

In this procedure, the planned order or the purchase requisition contains the separately planned storagelocation.


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Storage Location MRP !(&

Stock shortage in separately plannedstorage location in plant 9666

Stock transport re"uisition in separatelyplanned storage location in plant9666Release order re"uisition in plant 9:66

Replenishment per stock transferbetween plants


Stge locs2planned inplant

Stge loc2plannedseparately

(((


Plant 9:66Plant 9:66

Stocktransfer

from anotherplant

Procudure* stock transfer between plants

The special procurement keys for storage location #$% &eternal procurement, inhouse production, stock

transfer from another plant' are defined in -ustomizing.


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Storage Location MRP !5&



Storage locationsexcluded from theautomatic planning run

Stock shortages in storage locations

that are excluded from materials

planning are not included in the

planning run

/xcluding the storage location from materials planning

The stocks of the storage locations ecluded from materials planning are not included in plant stock.


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Chapter 2 Review !9&


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Chapter 2 Review !:&

stock can be transferred to a storage location from

another plant

a storage location can be completely excluded from

materials planning at plant level


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-hapter : /xercises* Reorder Point Planning

Storage location MRP

ne storage location (***2) for the ne+ ra+ material ,2MM-.. is to /e planned separately" Storage location (***!) that yoalready created in e0ercise ! is sed as the central +arehose"Procrement for storage location ***2 is to /e carried ot asfollo+s1 the prchase re'isition is directly created for the storagelocation as the vendor delivers direct to the storage location andthe goods receipt is also directly posted for this storage location"

Therefore yo have to create storage location ***2 in thematerial master record for the ra+ material ,2MM-.. and yomst set the indicator for storage location MRP" Then yo haveto carry ot the single-item planning rn for the material andorgani3e replenishment for the separately planned storagelocation"

!" Create the ne+ data in the material master record1

4n the material master select1

Material Create special Raw material.

5nter the material nm/er ,2MM-.."5nter the indicator for the indstry sector mechanicalengineering"Select the psh/tton Select view(s) and only select the vie+MRP :1

Select Continueand the screen for the organi3ational levelsappears" 5nter plant !*** and storage location ***2"

4n the section of the screen entitled Storage location MRPenter the MRP indicator for planning storage locationsseparately" Select 650ternal procrement7 for the specialprocrement type maintain a reorder point of 8** pieces and

a replenishment 'antity of 2*** pieces"9hat is the prpose of the reorder point for a material planned


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sing reorder point planning:

;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;

Save the material master record"

2" Carry ot the planning rn for the material"

Access the men for materials planning1

Logistics Materials management Materials planning MRP

To carry ot the planning rn select1

Planning run Sng-item, sng-level.

Carry ot the planning rn sing creation indicator 2 (prchasere'isitions in opening period other+ise planned orders)" AnMRP list is al+ays to /e created for the planning reslts"

After having e0ected the planning rn display the MRP listand discss the reslts" Display the te0ts for the e0ceptionmessages" To do this position the crsor on the e0ception

indicator and select1

EditDispl.ecept.message.

8" Carry ot replenishment for storage location ***21

rders are made directly for storage location ***2" To do thisconvert the prchase re'isition in the MRP list into aprchase order"


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Position the crsor on the prchase re'isition and select1

Environment Convert Pur.re!. pur.ord.

4n the initial screen for creating prchase orders enter theprchasing organi3ation !***" The material is to /e orderedfrom vendor !*88 as this vendor provides the fastest service"

Transfer the data of the prchase re'isition" The prchaseorder already contains the target storage location"


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Chec= any changes in the stoc=>re'irements list"

9hat +old the reslt have /een if the goods receipt had/een completely posted:

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-hapter : Solutions* Reorder Point Planning

Storage Location MRP

+o 92 0hat is the purpose of the reorder point for amaterial planned using reorder point planning=The reorder point shold cover the average consmptionin the replenishment lead time" 4f the stoc= level falls/elo+ the reorder point the material mst /e replenishedfor the amont of the lot si3e"

+o :2 0hat would the result have been if the goodsreceipt had been posted for the complete "uantity=As only half of the 'antity +as posted the prchaseorder remains - redced /y the goods receipt 'antity"Plant stoc= +as also increased /y the goods receipt'antity"4f the goods receipt had /een for the complete 'antityplant stoc= +old have /een increased /y the completeprchase order 'antity and the prchase order +old nolonger /e visi/le in the stoc=>re'irements list"

Documents

03_LO525_Reorder Point and Store Location Planning.doc