Automatic reorder point and safety stock caluclation- MRP type:V2
Hi,
I want the system to calculate reorder point and safety stock. To simulate this i created one material with
MRP type:V2, service level as 97%, Forecast model:D,Hist. period:12,Forecast periods:12, and I entered
the historical value for past 12 months as 100 nos in material master.
04.2009 100
03.2009 100
02.2009 100
01.2009 100
12.2008 100
11.2008 100
10.2008 100
09.2008 100
08.2008 100
07.2008 100
06.2008 100
05.2008 100
Then I went to MP30 and executed the forcase.When I checkd the material master the system has calculated the reorder point as 14 nos. But there is no value updated in safety stock field.
Now I have two questions.
1) How the system has arrived the reorder point value as 14 nos.
2) Why there is no safety stock updated in material master.
Could u please clarify this.
Thanks and Regards
Purushothaman
Hi,
This is further to my preivous mail. I have changed the consumption values and now i am getting the safety stock.
MRP type:V2, service level as 97%, Forecast model:D,Hist. period:12,Forecast periods:12, and I entered
the historical value for past 12 months as.
04.2009 100
03.2009 80
02.2009 110
01.2009 85
12.2008 90
11.2008 95
10.2008 125
09.2008 90
08.2008 90
07.2008 92
06.2008 101
05.2008 100
After executing the forecase the sytem has calculated the below parameter.
Basic value:95.759
MAD:11.448
Safety stock:10.252
Reorder point:23.658.
Can anyone explain me how these calculation arrived.
Thanks and regards
Purushothaman
Similar Messages
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Static or Dynamic Reorder Point and Safety Stock
Hi,
In a retail scenario, what would be the advantages over the other of setting a static or dynamic reorder point and safety stock?
The MRP type used is Time Phased Planning, but whether to let the system automatically set the reorder point and safety stock is the question. What should be considered in implementing this?
Regards,
Leehi,
As far as i know is static means manual entry of reorder point.
The dynamic or automatic reorder point is used for Forecast based planning...
the sysstem wii automatically calculate the reoder point evrytime there is the forecast run.
So, it dependig on ur scenario , select either manual or automatic.
First entry for both is always manual entry....
hope u got this..
Regards,
Smitha -
Is there any bapi returns dynamic value of reorder point and safety stock
Hi all,
Is there any bapi returns the runtime value of ROP and SS by passing changenr/objectid taken from CDPOS.
if exists please send me with code.
Thanks
PRR Rhi,
As far as i know is static means manual entry of reorder point.
The dynamic or automatic reorder point is used for Forecast based planning...
the sysstem wii automatically calculate the reoder point evrytime there is the forecast run.
So, it dependig on ur scenario , select either manual or automatic.
First entry for both is always manual entry....
hope u got this..
Regards,
Smitha -
MRP with reorder point and safety stock and planning calender issue
Hi,
We are using currently MRP type PD and using Scheduling agreements and after the demand management changes when ran MRP the delivery quantities are fluctating in higher range and vendor complains about it so to avoid this we are constantly changing GR Processing days in material master? how can we avoid the drastic changes on the order quantites on scheduling agreements with out changing GR processing days.
For example : we constantly manufacter 480 vehciles per week and some time because of holidays it will be 320 or 560 per week then the forward scheduling agreement quantites instead of 480 parts week(twice a week delivery) goes up and down and vendor needs a at least a range for his prodcution?
I was thinking to use Reorder point but when i changed the MRP type VB then i cannot see forward scheduling agreements at MD04? does MRP type VB or V1 will allow forward scheduling also like 120 days ahead of planning?
Appreciates everyone time and help.
Thanks and Regards,
Sivayou can use MRP time fence to restrict the changes in planning data for specified horizon. For example If MRP time fence = 30 days, no changes in planning data will be allowed for coming 3o days unless you manually intervene.if any new requirements came in this period , they will be planned automatically at the end of this period only.
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How much to order , reorder point and Safety stock calculation in SAP?
Existing Client is Distribution company , the Challenge is how much order , when to order and how much safety stock we need to keep for Material in SAP?
Limitations with Client System:
u2022The existing system does not enable purchasing to have visibility to firm (open sales orders) and planned (customer forecasted) demand for a material.
u2022If a sales order is placed that consumes all of the inventory available, the purchasing department is not notified automatically to replenish the stock
u2022The system in place currently does not enable the organization to maintain a level of safety stock.
u2022If inventory is logically allocated to a priority customer based on their forecast, there is no way to ensure that inventory is reserved for the priority customeru2019s orders u2013 other sales orders often consume it.
u2022If a material is backordered with several sales orders waiting for parts, the sales orders are allocated based on earliest requested delivery date upon receipt of the part; there is no way currently to allocate the stock across the open sales orders if it is determined that is the appropriate course of action.
Thanks
SwethSweth, you are asking for consulting, and in my opinion it is way beyond what can or should be reasonable to achieve in such a forum. You are asking complex questions, that most probable have more than one possible answer.
I suggest that you get on-site help from a knowledgeable and experienced consultant. These are crucial business issues, and should be dealt seriously. -
Difference :Automatic Reorder Point Planning and Forecast based palning ?
Dear MM Guru's,
As we See in throtical Concepts that
Automatic Reorder point planning and Forcast Based Planning Used the prevuious Historical Data.
Please explain what is difference Between them.
regards,
A. S.Hi,
Reorder Point Planning: -
Use: -
In reorder point planning, procurement is triggered when the sum of plant stock and firmed receipts falls below the reorder point.
Features: -
The reorder point should cover the average material requirements expected during the replenishment lead time.
The safety stock exists to cover both excess material consumption within the replenishment lead time and any additional requirements that may occur due to delivery delays. Therefore, the safety stock is included in the reorder level.
The following values are important for defining the reorder point:
- Safety stock
- Average consumption
- Replenishment lead time
The following values are important for defining the safety stock:
- Past consumption values (historical data) or future requirements
- Vendor/production delivery timelines
- Service level to be achieved
- Forecast error, that is, the deviation from the expected requirements
Manual Reorder Point Planning
In manual reorder point planning, you define both the reorder level and the safety stock level manually in the appropriate material master.
Automatic Reorder Point Planning
In automatic reorder point planning, both the reorder level and the safety stock level are determined by the integrated forecasting program.
The system uses past consumption data (historical data) to forecast future requirements. The system then uses these forecast values to calculate the reorder level and the safety stock level, taking the service level, which is specified by the MRP controller, and the material's replenishment lead time into account, and transfers them to the material master.
Since the forecast is carried out at regular intervals, the reorder level and the safety stock level are continually adapted to the current consumption and delivery situation. This means that a contribution is made towards keeping stock levels low.
Forecast-Based Planning: -
Use: -
Forecast-based planning is also based on material consumption. Like reorder point planning, forecast-based planning operates using historical values and forecast values and future requirements are determined via the integrated forecasting program. However, in contrast to reorder point planning, these values then form the basis of the planning run. The forecast values therefore have a direct effect in MRP as forecast requirements.
Features: -
The forecast, which calculates future requirements using historical data, is carried out at regular intervals. This offers the advantage that requirements, which are automatically determined, are continually adapted to suit current consumption needs. The forecast requirement is reduced by the material withdrawal so that the forecast requirement quantity that has already been produced is not included in the planning run again.
Reducing Forecast Requirements
- Reducing forecast requirements by consumption
If consumption is higher than the forecast requirements in the current month, then the system also reduces future forecast requirements.
- Reducing current forecast requirements by consumption
If consumption is higher than the forecast requirements in the current month, then the system does not reduce future forecast requirements.
- Average reduction of the forecast requirements
The reduction of the forecast requirements is based on average daily consumption. Actual consumption data is not relevant.
The system calculates the average daily requirement first using the formula forecast requirement/number of workdays in the forecast period.
The forecast requirements are then reduced by the quantity resulting from the following formula: number of workdays worked x average daily requirements.
Period Pattern and Forecast Periods
You can specify the period pattern for the forecast (daily, weekly, monthly or per accounting period) and the number of periods to be included in the forecast individually for each material. It is possible, however, that the forecast period pattern is not specific enough for planning purposes. In this case, you can define per material that the forecast requirements should be divided according to a finer period pattern for planning. You can also define how many forecast periods are to be taken into account during requirements planning. The splitting indicator is defined in Customizing for MRP per plant and per period unit and is assigned to the material in the material master.
Example: -
For a monthly forecast, the requirements date would be set on the first workday of the month because, for planning, it is assumed that the total requirement must be available at the beginning of the period. You can then divide this monthly requirement into either daily or weekly requirements. -
Automatic reorder point planning
Hi Gurus,
Cud somebody guide me on the Basic settings required for AUTOMATIC REORDER POINT PLANNING'VM',Including SPRO settings.I cudnt find an answer for this from previous FORUMs.
Kindly give me u r suggestions or aslo suggest some good links for PP documents or links concerning with Automatic reorder point planning and its settings.
THNX in ADVANCE
HKRhi HKR
In automatic reorder point planning, both the reorder level and the safety stock level are determined by the integrated forecasting program.
The system uses past consumption data (historical data) to forecast future requirements. The system then uses these forecast values to calculate the reorder level and the safety stock level, taking the service level, which is specified by the MRP controller, and the material's replenishment lead time into account, and transfers them to the material master.
Since the forecast is carried out at regular intervals, the reorder level and the safety stock level are continually adapted to the current consumption and delivery situation. This means that a contribution is made towards keeping stock levels low.
http://help.sap.com/saphelp_47x200/helpdata/en/f4/7d256344af11d182b40000e829fbfe/frameset.htm
regards
sachin -
Automatic reorder point planning -forecast view
Hi
Our client want to implement automatic reorder point Planning.
Reorder point quantity was maitained from last 3 years but MRP type is 'ND' as they are not using MRP.
Now i am changing MRP type to:VM and in forecastting view: i maintained model as:D constant model period indicator:M
His periods:60 , forecast periods:12 initialization:X tracking limit:4000 selection procedure:2 reset automatically
Is it ok ? than can i run MP30. and the client wants to run for many materils(2000).
How can be run for many materials.?
Regards,
srihari.MDear,
In automatic re-order oint planning , system uses past consumption data (historical data) to forecast future requirements. The system then uses these forecast values to calculate the reorder level and the safety stock level, taking the service level, which is specified in MRP2 view, and the material's replenishment lead time into account, and transfers them to the material master.
Since the forecast is carried out at regular intervals, the reorder level and the safety stock level are continually adapted to the current consumption and delivery situation. This means that a contribution is made towards keeping stock levels low.
From MP30 you have to executed forecast and system has generated forecast values and updated safety stock and reorder point also. Only thing to remember is you have to maintain service level in MRP 2 view of material master when you use VM- MRP type to calculate safety stock and reorder point
Find bleow the set up following set up for automatic re-order point planning :
1.Material Master Set up : Maintain all the relevent parameters from MRP1 to MRP4 view , Forecasting View
1.MRP Type -VM , Lot Size -EX
2.Procurement Type -E for FG and F for ROH
3.Planning Startegy -10 or 40 in FG/SFG and 20 for componenet
4.Planned Delivery Time in MRP2 VIEW
5.Indiviaul/Collective Indicator - 1/2 based on your requirement in MRP4 View
6.BOM Explosion -Keep it blank
7.Service level percentage -MRP2 view
8.Maintain Forecastin view data like model selection , Histry period , period indicator , Forecast control pramaters ,
10.Make sure that you have min 12-8 monhts total consumption update in Forecasting view .
Configuration : InSPRO -MRP -Check MRP Type -VM-check the details like Re-Orde point .Safety Stock both the automatic calcvualtion box are marked .
Finally as a sample test , select any material -mm02-execute forecast in mm02-forecasting view -exectute forecast -then save .Run MRP in MD03-1,1,3,3,1.NETCH indicator and check the result in MD04
HOPE IT WILL HELP. PLEASE REVERT BACK.
Regards,
Alok Tiwari -
Re: Automatic Reorder point Planning for Finished Goods
Hi All,
I have some doubts regrading the Automatic Reorder point Planning for Finished Goods.
For testing purpose I have entered the consumption values for two month.
Say :
Nov-08=13
Dec-08=20
ROL level=5
Safety stock =4
Model =constant
Now when I execute the forecasting,The system gives me the forcast for the next two month jan & Feb.
But when I run the MRP I see planned order for 5.So how to fulfill my forecast for jan?
Please Advice.
Regards,
VivekHi Brahamakar,
Can you please help me.
Regards
Vivek -
Report on current stock and safety stock
Hi,
I want to have the report on current stock and safety stock.
In MC.9 it gives wrong safety stock. When I go to cross check the safety stock in material master & in MC.9 I see differences.
Thanks,
KiranYou can user tcode MC.9 or MC.5 to know valuated stock available at given plant. Stock lying in Returns (MB52) will not be a part of this report as it non-valuated stock.
The stock in the accounting view of the material master considers stock at plant level including stock in Transit (Intra & Inter plant stock trasnfers) & special stock like stock issued to vendor , consigment stock etc which is valuated at plant level.
whereas and stock in the plant stock view of the material master does not consider such special stocks hence there will always difference in both veiws.
For Physical stock as on particular date you can consider MB5B report with radio button "Storage location/Batch Stock" wherein you will get Quantity issued & Qunatity received in those SLOC along with Opening stock & Closing stock for the specified period.
use tcode
MBLB to know stock at vendor.
MB54 - Consignment Stock. -
Overview of AR Invoice and Safety Stock API
Hello experts,
I am new to oracle apps. Please send the me overview of AR Invoice and Safety stock API in inventory.
Thanks a ton in advance.
KumarSoni,
Please see (Note: 296559.1 - FAQ: Common Tracing Techniques within the Oracle Applications 11i/R12). Since you run the API from SQL*Plus/TOAD, follow the steps under "d. Note that a similar technique can be used for enabling trace with binds for a user in SQL*Plus" section to generate the trace file, and the steps under the TKPROF section to generate the TKPROF file.
Thanks,
Hussein -
Automatic reorder point calculation
I would like to confirm the formula for calculating a reorder point in SAP.
As I understand it, the simple formula is safety stock + average requirements * lead time.
I have the following settings for a material:
MRP Type - V2
Lot size - HB
Maximum stock level - 500
Total lead days (including GR processing) - 30
Service Level - 98%
Procurement type - F
Historical periods - 2
Forecast periods - 2
Period Indicator - M
Forecast Model - G (Moving average)
Consumption values - 12/2010 - 160
11/2010 - 190
When I execute the forecast run, the get the following result:
Basic Value - 175
MAD - 15
Safety Stock - 39
Reorder point - 219
If the formula for calculating reorder point is - 39 (safety stock) + 175 (average requirement) * (30(lead time)/30(forecast period in days), then the reorder point should be 214. Why does the system output 219?
I read somewhere that a SAP note exists for correcting the calculation, can anyone confirm?
Many thanks.Dear
Automatic calculation of reorder point RP : The reorder point will be calculated with following formula :
RP = average consumption during LT + SS
SS = R x Sq root ( ( LT(d) x 7 ) / FCperiod(d) x 5 ) x MAD
In your case , ROP will be calulated as per your consumption for November with 20 days having consumption of 190/m and December for 10 days having consumption of 160 /month
So Reorder Qty = 190(20/30)+160(10/30)+39 =219
Refer our earlier posting on the same : Detail the safety stock calculation
Regards
JH -
Hi
I have following setting in material.
Mrp type -VM
service level -- 80 %
planned delivery time -- 2
But system is not creating any proposals.Dear ,
Both ROP-Automatic and Manual as well as FBP , system uses the Past Consumption (Movement Type 601, 261, etc -Consumption against Sales , projects , free issue of material through Movement Type -OMJJ-Material Master Update as Planned or Unplanned Total Conmtion in MMR-Forecasting View ) of certain period and Create Demand through Forecasting .
Now this demand-Forecasted Demand or Re-Order Point (which also a demand qty ) will teated through MRP to have Procurement Element based on planning situation after Net Requirement Calcualation and also Safety Stock..
So basically , what you have to do as a test trial is as follows :
1.Maintain Forceasting View of the Material master with Model Selection , Period Forecast , Persion per session , Initialisation Indicator , Paramter Optimisation , Histty periods min 6-12 motnhs .
2.Goto Total Consumption tab , maitain total consumption ( planned or unplanned ) -Thi is basically happnes best on the Busness txn and OMJJ updates as explained above.Now hit Excetute Forceast -it will pop up with window with model as selected ( let say Moving average -G) , continue and then you will find basica valuses , MAD , Forceasted Demand ,ROP Qty all are in date wise .Save this and now run MRP you will find result in MD04.Bsically there are two parts one is executing forcast to calcualte ROP automatically based on MRP type -VM and Forecasting view and then Run MRP-MD03
Hope this is clear
Regards
JH -
How to use forecast and safety stock
Hi
We have below business case for MRP case and scenarios , please guide me how to use safety stock in this case.
Requirement : System should always raise PR for quantity of forecast only , if forecast in not available then for the safety stock
Planning cycle
100 (Monday)
Deliver cycle
500(Friday)
Forecast model
S
Lead time
4
Safety stock
10Hi
Did anyone have idea how to use safety stock with forecast in such a way that System should always raise PR for quantity of forecast only , if forecast in not available or less then the safety stock quantity PR will be raise with safety stock quantity -
Hi,
in our ASCP plan, currently we have items with Safety Stock values manually inserted valid over all planning horizon.
Therefore all the safety stock is NON-TRANSIENT.
Actually we have Priority Based pegging with:
MSC: Include Safety Stocks in Priority based Pegging: YES.
What is appening is that ASCP peg On Hand quantities to FORECAST DEMAND, then pegs other supply type to SAFETY STOCK Demand.
I would like ASCP to peg OH to Safety Stock Demand (DUE on the plan start date) before Forecast demand (due in the future).
Someone knows how to obtain this "feature"?
Thanks in advance.
GiacomoGiacomo,
I'll give you a few pointers, but this may be difficult to achieve. Try this as a test.
I assume you have a constrained ASCP plan. This question wouldn't be as relevant in an unconstrained plan because the demands would just be calculated and priority pegging isn't that useful. .Is that correct, you have a constrained plan?
The key point is that you mentioned is that you have NON-TRANSIENT safety stocks. This means that you are setting a value due today for 100 units and at the end of the plan, you still want to have 100 units of safety stock planned.
ASCP priority pegging logic has these rules:
1. Any supply quantity that pegs to NON-TRANSIENT safety stock CANNOT be used at a future date to peg to real demands. [It's not going to happen]
2. Any Supply quantity that pegs to transient safety stock CAN be used at a future date (when the corresponding dip in safety stock occurs) to meet demands. [This means that it can release the supply and re-peg to a future demand].
Independent Demands have a seeded demand priority by default. The first two below are set by a profile option, safety stock is always the lowest priority ( a number something like 99999 where the higher value is lower priority)
1. Sales Order = 10,000*
2. Forecast = 100,000*
3. Safety Stock = 999,999 (not sure of this internal value)
Set by a profile with a name like msc: default sales order priority
For priority pegging setup instructions, please see the ascp user guide. The basics would be the use of two profiles mso: demand window size and mso supply window size. This determines how ascp will select and sort your supplies and demands for pegging. It starts at the first demand date or supply date and selects that many future days of demand and supply to sort and then peg.
You also setup a priority rule that determines how ascp calculates priorities for pegging. To accomplish what you want to do, you would have a rule like
1. MDS & Sales Order priority
2. Schedule Date
This is a commonly used example. The pegging process will the select the number of days you have chosen and sort the demands based on their prioirty.
Sales orders are more important (to you) than safety stocks, but not forecasts. You want the safety stock to peg the on hand, not a future forecast. This can only happen because you have mso: demand window size set to a number of days where pegging sees the future demand in the same sort. I haven't seen this requirement (SS higher priority than forecast), so you'll need to test my suggestion.
Set the value of MSC: Default forecast priority = A huge number (higher than 999999).
The intent is to make the demand priority the SAME as a safety stock demand. In this case, with the priority rule I suggested, the schedule date will determine the pegging order.
I think this will get you close. You can view the internal proirity calculated by ASCP for the independent demand by selecting that order in the pegging details and then rightclicking to select the properties. The pegging details wil show you the priority value that was used.
Hope this helps.
Kevin
www.inspirage.com
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