Statistical Reordering
This function was designed for two purposes:
- create the reorder suggestions for products managed with a reorder threshold or with periodic reordering.
- calculate and update the data of the product site record: the safety stock, the maximum stock, the reorder threshold, the economic lot depending on the stock setups and the product consumption history.
Suggestions can be established according to:
- the data of the product-site record,
- the data calculated during the processing.
Only the products managed by these two reordering methods are processed and only the data for these products are updated.
The reordering is statistical:
- only products of category A, B or C are processed,
- it is based solely on the stock levels,
- it does not take into account the provisional orders, nor the planned orders (sales, purchasing, production),
- and does not pass down the BOM.
The calculation takes into account:
- actual requests,
- firm purchase orders,
- firm and allocated customer orders.
Prerequisite
Refer to documentation Implementation
Screen management
Entry screen
Presentation
Periodic replenishment method
The periodic replenishment method is used to determine a variable quantity suggestion for a date set according to certain criteria.
During the calculation, the system proposes a suggestion that is based on the following elements:
date of the last process, maximum stock, physical stock, stock with status Q, allocated stock (global, detailed, shortage), stock in firm order.
The suggestion is determined in the following way:
Suggestion = Maximum stock – available stock – stock on order
The available stock corresponds to the physical stock minus the allocated stock (global, detailed, missing) and increased by the stock with status Q.
The products managed by replenishment period that are not involved with the current process (date of the last process + periodicity greater than the current date) are processed by the reorder threshold method if they are in shortage.
Example of the periodic replenishment method
Product A
Frequency: 7 Calendar days
Maximum stock: 5000 pieces
A | Q | R | Allocated | Available stock | Shortage | On order | Suggestions |
900 | 0 | 0 | 900 | 0 | 0 | 5500 | 0 |
900 | 0 | 0 | 0 | 900 | 0 | 0 | 4,100 |
900 | 0 | 100 | 800 | 100 | 0 | 400 | 4,500 |
900 | 500 | 200 | 900 | 0 | 200 | 0 | 5,200 |
900 | 500 | 200 | 900 | 0 | 200 | 400 | 4,800 |
1,300 | 500 | 200 | 900 | 400 | 200 | 0 | 4,800 |
900 | 500 | 200 | 900 | 0 | 200 | 1,500 | 3,700 |
Reorder threshold method
The reorder threshold method is used to create a suggestion for a fixed quantity when the order point is reached.
This method takes into account a certain number of elements:
the economic quantity (Replenishment lot), the replenishment threshold (order point), the available stock the stock in quality control, the stock on order, the allocated stock (detail, global, shortage).
There will be a suggestion when the calculation (Available stock + Stock on order) becomes less than the reorder threshold.
The available stock corresponds to the physical stock minus the allocated stock (global, detailed, missing) and increased by the stock with status Q.
The system then generates a suggestion at economic lot level.
If the economic lot does not lead to achieving the replenishment threshold, then the system generates a suggestion for a quantity equal to the replenishment threshold - (available stock + stock on order).
Example of the replenishment threshold method (Reorder point method)
Product A
Replenishment threshold : 1,000
Economic lot : 5,000
A | Q | R | Allocated | Available stock | Shortage | On order | Suggestions |
900 | 0 | 0 | 0 | 900 | 0 | 5,000 | 0 |
900 | 0 | 100 | 800 | 100 | 0 | 5,000 | 0 |
900 | 500 | 200 | 900 | 0 | 200 | 1,200 | 0 |
900 | 500 | 200 | 900 | 0 | 200 | 800 | 5,000 |
1,300 | 500 | 200 | 900 | 0 | 200 | 800 | 5,000 |
900 | 500 | 200 | 900 | 0 | 200 | 0 | 5,000 |
Header information
The header information includes the specification of the site. The site shown by default corresponds to the site associated with the user.
Process selection criteria
The processing can be used:
- either in the calculation of the reorder point,
- or in the calculation of the periodic replenishment (or both simultaneously).
The calculation can be performed:
- based on the data of the product-site record,
- based on the calculated date.
It is possible to carry out the calculation and the updating of the calculated data without creating a reorder request.
It is also possible to carry out the process from the data previously calculated without modifying any of these. It is then required to:
- specify the calculated date of the product record as calculation basis,
- uncheck all calculation selections.
Calculation selection
For the running of a process from the calculated data, it is necessary to choose the various data that will be updated.
This calculation uses a consumption history that is itself generated by the periodic process function.
Safety stock calculation
The safety stock calculation is conducted based on an average consumption for a determined period.
The calculation uses the following formula: Safety stock = K*sigma*SQR(Lead time)
K is a constant that depends on the product service rate.
Sigma represents the variance type of the consumption over the calculation period.
Lead time represents the reorder or production lead time expressed in the product-site record.
Service rate for classes A, B or C
For each class, the service rate needs to be specified (coefficient expressed in percentage).
The relationship between the service rate and the coefficient is expressed in the Safety stock coefficient table.
Replenishment threshold (order point)
The reorder point calculation is based on an average consumption for a given period.
The reorder point method uses the following formula:
Reorder point = (Average daily consumption * reorder lead-time) + Safety stock.
Economic quantity
The calculation of the economic quantity is based on a consumption over a given period. The economic quantity calculation uses the Wilson formula:
Economic quantity = Ö (2*R*Oc/(I*Uc))
D: represents the requirement over the period
Oc: Cost of processing an order
A: Stock holding rate
Uc: Unit cost
Maximum stock
The maximum stock is linked to the products that are the object of a periodic replenishment. It is calculated in the following way:
Max stock = average daily consumption * (reorder lead time + periodicity between two replenishments)
Class selection
It is possible to carry out the process for a product class type (A, B, C)
Selection by range
It is possible to select products by:
product ranges, categories, planner code, product statistical groups.
Process log file
There are two log files possible depending on the process (after confirmation using the [OK] button). The log file opens. This file can be printed using the [Print] button.
The log displays a list, according to the requested criteria:
- products awaiting replenishment,
- results of calculation data,
- errors.
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Fields
The following fields are present on this tab :
Block number 1
| Enter or select the storage site where the selected product is active. The Selection icon (magnifying glass) only suggests products that are referenced in the products-sites table. |
Processes
| To be checked to process the products managed on threshold. |
| Replenishment calculation basis
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| To be checked to process the products managed periodically. |
| Replenishment calculation basis
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Calculations
| Checked if a safety stock recalculation previously carried out must be used as the basis of the reorder calculation. Formula: Security stock = K * sigma * lead time Where:
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| Checked in the event where a safety stock recalculation previously carried out must be used as the basis of the reorder calculation. Formula: Average consumption / day * (reorder lead time + reorder time) The calculation is only carried out if there is a minimum history available. The number of months in the history used has a ceiling with a maximum number or months defined (the most recent months). |
| Checked if a preliminary recalculation of the replenishment threshold must be used at the calculation basis. Formula: Replenishment threshold = Average consumption during the reorder lead-time + security stock (according to parameters). The calculation is only carried out if there is a minimum history available. The number of months in the history used has a ceiling with a maximum number or months defined (the most recent months). |
| Checked if a preliminary recalculation of the replenishment economic quantity must be used at the calculation basis. Formula (WILSON): Q = root of (24 * R * Oc) / (Sc * Pc) Where:
The calculation is only carried out if there is a minimum history available. The number of months in the history used has a ceiling with a maximum number or months defined (the most recent months). |
Starting stock deductions
| Select this check box if the planning calculations should decrease quantities related to suspended transactions from the available stock quantity. |
Selections
| Check this box to process the A, B, C, D class. |
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Start - end range
| Enter the selection start product number. The product ranges limit the report to these products only. |
| Enter the ending product number for the selection. Product ranges are used to restrict the report to these products only. |
| The product categories are used to classify and filter the products according to their use. This step makes it possible to refine the selection prior to carrying out the adjustment process. This code is used in the Product record to enable selections. |
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| Enter or select the code of the operator responsible for reordering the product on the selected site. This code is referenced in several scripts, such as the buyer’s plan, the supplier order entry, etc. |
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Code of the product statistical group, comprised of three alphanumerical characters, to be entered for the chosen group. It is associated with a meaningful label. |
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Batch task
This function can be run in batch mode. The standard task FUNSTKB is provided for that purpose.