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Inventory Replenishment

This function allows you to run an Inventory replenishment routine that looks at an Item’s current stock level and addresses Supply and Demand into the future.  From this it makes recommendations to ensure that actual and anticipated demands will be satisfied. 

 

Two options are available for Inventory Replenishment:

 

Single Level MRP: This focuses on nominated Items and addresses the Item’s current actual and/or forecast future demands to create Suggested Orders required to maintain stock.

 

Multi-Level MRP: In addition to looking at the current actual and/or forecast future demands for each Item this option also looks to see if the Item is a Parent in a Bill of Material and, if so, will ‘explode’ any Suggested Orders to determine the components required to make it.  These are then used as ‘Suggested Demands’ when assessing component requirements

 

The results of these processes is presented for your attention where you can amend the recommendations before converting into actual Assembly or Purchase Orders.

 

Opening Screen

 

Entry and Display fields

 

Create New or Open Previous:  Only one Replenishment Run can exist at any time in the database.     Therefore the following scenarios can exist

 

In the first two instances you have no choice but to run ‘New’, in which case the parameters in the opening screen need to be completed.  In the final scenario you should ‘check’ the appropriate checkbox.  If the ‘Previous’ checkbox is selected then, upon clicking the OK Button, you will be directed to the Detail screen

 

Previous Replenishment Run

 

Replenishment Last Run Date: If a previous Replenishment run exists that has not been posted then this will show the date when it was run.   If no previous run has been done or the previous run has been posted then this field will be blank

 

Status: If a previous Replenishment run exists then this will be prefilled with the status ‘In Progress’.    If no previous run has been done or the previous run has been posted then this field will be blank.

 

New Replenishment Run

 

Replenishment Horizon: This tells the Replenishment routine how far into the future to look at Supply and Demand.  The following options are available:

Fixed Period in Days - If this checkbox is ‘checked’ then the number in the adjacent field is the number of days into the future that the Replenishment run will process

Lead Time + Additional Days - If this checkbox is ‘checked’ then the number of days into the future that the Replenishment run will process is defined by the Lead Time days against the individual Item plus the number of days entered in the adjacent field.

 

Daily or Weekly: Select either Daily or Weekly replenishment quantities.

 

Multi Level Explosion: If this checkbox is:

 

Specific Site: If this checkbox is ‘checked’ then the following field will be made available for selecting the Site

 

(Specific Site Selection): If the previous checkbox is ‘checked’ then select the specific Site from the drop-down list.  The Replenishment Routine will then only run against Inventory and Replenishment Parameters linked to this Site.

 

Convert Transfers to Purchases: If this is 'checked' then the Replenishment process will override any Transfer requirement to a purchase requirement. You should note that this only applies when multiple sites are involved and items have been defined as being sourced via transfers from other parent sites

 

Exclusions

 

Exclude Sales Demand: If this checkbox is ‘checked’ then any Demands from Sales Orders will be ignored

 

Exclude Jobs Demand: If this checkbox is ‘checked’ then any Demands from Job Orders will be ignored

 

Exclude Assembly Demand: If this checkbox is ‘checked’ then any Demands from Assembly Order Lines will be ignored

 

Exclude Purchase Supply: If this checkbox is ‘checked’ then any potential receipts from Purchase Orders will be ignored

 

Exclude Assembly Supply: If this checkbox is ‘checked’ then any potential receipts from Assembly Orders will be ignored

 

Exclude 'Planned' Order Status: If this checkbox is ‘checked’ then any  Sales, Purchase, Job, or Assembly Order whose status is 'Planned' will be ignored

 

Exclude 'On-Hold' Order Status: If this checkbox is ‘checked’ then any  Sales, Purchase, Job, or Assembly Order whose status is 'On-Hold' will be ignored

 

 

Forecasting

 

During the Replenishment Process Ostendo will compare Forecast demands and Actual Demands for each Item to arrive at an ongoing demand based on the greater of the Cumulative Forecast and the Cumulative Actual Demand.   (See Replenishment Process below for more details).  The Forecast can originate from one of two sources:

 

Inventory:  This type of forecast is based on future Inventory transactions and is primarily used by the Warehousing/Distribution industry to replenish stock.  This Forecast generation is often based on past Inventory transactions projected into the future

 

Sales:  This type of forecast is based on future Sales and/or Job Orders (Independent Demands) and is primarily used by the Manufacturing industry who use multi-level Material Requirements Planning (MRP) to create Replenishment Orders.  This forecast is driven by Sales/Job Demands to determine an Ongoing 'Independent' Demand.  The Multi-level Replenishment run then adds other - Dependent Demands - emanating from 'Suggested' Assembly Orders created during the Replenishment run. 

 

Exclude any Forecasts for Items: If this checkbox is ‘checked’ then Forecasts held in Ostendo will be ignored during the Replenishment Run.

 

Forecast Style: From the drop-down list select the Forecasting Style which you wish to use in the Replenishment Run.  The options are 'Inventory' or 'Sales'

 

Forecast From: From the drop-down list select the source of the Forecast to be used.  The options are:

 

Entered Monthly:  Refers to the Monthly Forecast as entered into screen Inventory>Item Forecast

History Generated:  This Forecast will be generated during this  Replenishment Run.  The next field (History Source) defines from where this information is obtained

 

History Source:  The Source of the History used to generate the Forecast.  The Options (and their method of calculation) are:

 

Average Days:  If this is selected then the Ostendo calculates the sum of the history (Inventory or Sales) over the number of days entered into 'History Days' and determines and average daily quantity.  This is used to calculate the Monthly quantity for the current and subsequent months.  This calculated value is then uplifted by the History Factor (I.e 10% uplift = Monthly Quantity * 1.1) to arrive at a monthly Forecast to use. 

 

Same Month Last year:  If this is selected then the Ostendo calculates the usage over the equivalent month in the past year and applies the History Factor (I.e 10% uplift = Monthly Quantity * 1.1) to arrive at a monthly Forecast to use in this Replenishment run. 

 

History Days:  Used by the 'Average Days' History Source to define the number of days history to use when determining the Average usage per day

 

History Factor:  Used by the History Source to facilitate and increase or decrease in the Forecast based upon the History Source value.  An entered value of 10% will increase the History Source amount by 10% (I.e. History Source * 1.1).

 

Include Pricing Forecasts:  If you wish to include Pricing Forecasts in this Replenishment Run then 'check' this checkbox.   Note: Pricing Forecasts are forecasts relating to a Special Price

 

 

Expedite

 

You can define whether you want the Replenishment Run to look at Supply Orders with the assumption that they can be expedited to satisfy an earlier demand.  In this instance an Expedite Report is produced identifying what Supply Order(s) has been expedited to satisfy the demand requirements.

 

Expedite Purchase Orders: If this checkbox is ‘checked’ then all Purchase Orders will be used to expedite demand where required.   A report can be produced showing where this has occurred.  Note:- When this is 'checked' you have the additional option to NOT expedite specific Purchase Orders by going to the Purchase Order Header screen and 'checking' the 'No Expediting of this Order' checkbox

 

Expedite Assembly Orders: If this checkbox is ‘checked’ then all Assembly Orders will be used to expedite demand where required.   A report can be produced showing where this has occurred.  Note:- When this is 'checked' you have the additional option to NOT expedite specific Assembly Orders by going to the Assembly Order Header screen and 'checking' the 'No Expediting of this Order' checkbox

 

 

Item Selection Options

 

Selection Options: The following selection criteria can be entered to restrict the Items that will be actioned in the Replenishment Run.  

 

Buttons

 

OK: If the ‘Open Previous Replenishment’ radio button was selected then clicking this button will bring up the Replenishment Results screen described below.  If the ‘Create New Inventory Replenishment’ radio button was selected then the program will carry out a scheduling run as described below before going to the Replenishment Results screen.

 

Cancel: Any entries made to the Opening screen will be ignored and the Replenishment Run process will be ended

 

 

Replenishment Process

 

This is a brief description of the Replenishment Process.   The following values, taken from the Inventory record, will be used in the Replenishment calculations:-

 

Step 1.     Delete previous Run Results

 

The first step is to delete the previous run results.  You should be aware, therefore, that every time you run the Replenishment routine you are, effectively, starting ‘from scratch’ and all amendments to the previous run that have not been updated will be lost.

 

Step 2.    Gross Demand

 

Looking at the first Item we must first determine the Gross Demand.  This comes from 2 sources

‘Actual’ Demand

Actual demand represents the demand coming from Orders in Ostendo with status ‘Open’, ‘In Progress’ or ‘On Hold’.  The quantity required is the un-issued quantity and the date is the ‘Start Date’ of the Order or Task.  However, where the date is beyond the Replenishment Horizon then the demand is ignored.

Additionally, if it is a Multi-Level MRP run then Suggested Demands (see below) generated from Suggested Assembly Orders will be included

Forecast Demand

Demand also comes from the Forecast where the Forecast date is equal to, or later than, the system date.  Item Forecasts are generated during this run to create forecast quantities/date as defined in the Item’s Forecast screen

 

A combination of the ‘Actual’ Demand and the ‘Forecast’ demand is used to arrive at the ‘Gross’ demand.   This is carried out as follows.

 

For each Inventory Item the program calculates the greater of the cumulative Actual Demand and cumulative Forecast Demand to determine a demand that will satisfy both.

 

  Actual Demand            4    2    4    7    1    5    6    7

  Forecast Demand        4    4    4    4    4    4    4

                                        ------------------------------------

                Demand         4    4    4    5    3    4    5    7

 

Step 3.     The following process is carried out depending upon the type of Replenishment being carried out.

 

Replenishment Process - Single Level MRP

 

The Single Level MRP Replenishment program goes through the following activities:

 

1.  The first day’s demand is assessed by adding any overdue Supply Orders to the Current Stock Level

2.  Is the ‘expected’ Stock Level below the Item’s Re-Order Level?

       No - Go to question 4

Yes - Determine the greater of (a) the quantity required to bring it up to the Re-Order Level and (b) the Re-Order Quantity.     Round this up in accordance with the Item’s Order Multiple and create a Suggested Order

3.  Add the Suggested Order Quantity to the Current Stock Level

4.  Go to the next day.  If the ‘Demand Horizon’ has been reached then select the next Item and go back to Activity 1

5.  Add any Supply Orders (Assembly Orders or Purchase orders) scheduled for this day

6.  Deduct any ‘Cumulative Demand’ scheduled for this day.

7.  Go back to the question 2

 

The results of the Replenishment run are displayed showing all Items that have had Suggested Orders created.  You can drill-down on each Item to see the detailed results of the run.  This shows (by Day) all Demands, Supply Orders, and Suggested Orders with a resulting stock balance at the end of the day.

The quantity displayed against the Suggested Order can be amended in this display.   The results of the amendment is immediately reflected on all subsequent daily balances

 

 

Replenishment Process - Multi-Level MRP

 

In the Multi-Level MRP Replenishment routine ALL Items are processed therefore no Item selection parameters are available.  The program goes through the following Logic:

 

1.  Determine the Low-Level Code for each Item.  This Code represents the lowest level in the Bill of Material structure that the Item appears and defines the priority sequence in which Items are processed.       

2.  The next step is to delete all previous Suggested Orders and Suggested Demands

3.  Commencing with the first Item at Low Level Code 0 the Actual Demand is evaluated on a daily basis. 

4.  The first day’s demand is assessed by adding any overdue Supply Orders to the Current Stock Level.

5.  Is the ‘expected’ Stock Level below the Item’s Re-Order Level?

       No - Go to activity 6

Yes - Determine the greater of (a) the quantity required to bring it up to the Re-Order Level and (b) the Re-Order Quantity.     Round this up in accordance with the Item’s Order Multiple and create a Suggested Supply Order.   

If this Item is ‘Assembled’ then get the component requirements from the Item’s BOM and create ‘Suggested Demand Orders’ for each Component where the quantity is that required to make the parent ‘Suggested Supply Order’ quantity (including component scrap) and the required date is the Parent Item’s required date, less its Leadtime.

6.  Go to the next day. 

 

The results of the Replenishment run are displayed via the ‘Create Required Orders’ screen where each Suggested Order can be amended and confirmed prior to converting into a physical order

 

 

Replenishment Results

 

This function shows the Suggested orders when running the Single-Level MRP option.  (The Multi-Level MRP option will immediately bring up the 'Create Required Orders' screen)

 

It comprises of three screens

 

List Screen

 

This screen shows each Item and the total Suggested Order Quantity generated via the Replenishment Run.   By default those Items that have no Suggested Orders are not displayed but they can be included by ‘checking’ the ‘Include Zero Qtys’ checkbox.

 

Display fields

 

Replenishment Run Date: Display only field showing when this Replenishment run was carried out

 

Replenishment Horizon: Display only field showing the Horizon parameters that were used for this Replenishment Run

 

Specific Site: Display only field showing the specific Site if this was selected for this Replenishment Run

 

Include Zero Qtys:  By default this is not ‘checked’ and only those Items that have Suggested Orders are displayed.  If this is ‘checked’ then the List panel will display all Items.

 

Select: ‘Check’ the checkbox where you want the Item’s Suggested Orders to be created.   You have the option to click on the ‘Select All Items’ Button at the bottom of this panel to select all the records.  You may also click on the ‘De-select All Items’ Button at the bottom of this panel to ‘un-select’ all the records

 

Item Code: Display only field showing the Item Number

 

Description: Display only field showing the description of the Item taken from the Item master record

 

On-Hand Qty: Display only field showing the current on-hand quantity including the quantity in Warehouses not included in the Replenishment Run

 

Sourced By: Display only field showing how the Item is sourced.  The displayed options are Assembly, Purchasing, or Supplier Assembled.

 

Total Suggested Quantity: Display only field showing the total of the Suggested Orders contained in the Details screen. 

 

Total Buy Value: Display only field showing the sum of the Suggested Quantity multiplied by the Item's base Buy Price

 

Total Supply Quantity: Display only field showing the total of current Purchase and/or Assembly Supply Orders.

 

Total Actual Demand Quantity: Display only field showing the total of current Sales and/or Job Line Orders.

 

Total Forecast Demand Quantity: Display only field showing the total of the Forecast Demands for the Replenishment Period

 

 

Data Display Options

 

Field Position - On the List screen you can move the field position by dragging the column heading left or right to the position where you want it to appear.

 

Filtering - Click on the black ‘down arrow’ to the right of your selected column heading and you can either select a specific entry to display all records containing that entry, or you can select (Custom…) to enter detailed selection criteria.

 

Buttons

 

Select All Items: Clicking this Button will place a check-mark in the Select column against all displayed Items

 

De-select All Items: Clicking this Button will remove check-marks from the Select column against all displayed Items

 

Accept Replenishment Results for Selected Items: All Suggested Orders against the Items that have been selected will be fixed as a Suggested Order and the remainder removed.  These Suggested Orders can then be converted into physical orders via the ‘Create Required Orders’

 

Close: This will close the Replenishment Results screen.  If you have any unsaved data then you will be asked if you wish to save it before the screen is closed.

 

Save: If you have ‘checked’ any line you should click this button to save the entry and stay in this screen

 

Cancel: Any ‘checked’ lines that have been made since the last time the ‘Save’ Button was pressed will be lost.

 

Related: This will bring up a list of functions that are related to Inventory Replenishment.  You may open and maintain information in those screens whilst still remaining in the Inventory Replenishment screen.

 

Reports: This will bring up a list of Reports that are related to Inventory Replenishment.  You can immediately run the report whilst still remaining in the Inventory Replenishment screen.

 

 

Detail Screen

 

This screen has two tabs

 

Entry and Display fields

 

Item Code: Display only field showing the Identity of the selected Item

 

Unit: Display only field showing the base Unit of Measure for the selected Item

 

Description: Display only field showing the Description of the selected Item

 

Default Supply Method: Display only field showing the Supply Method held against the selected Item

 

Status: Display only field showing the current status of the selected Item

 

On-Hand Qty: This is a display only field showing the current stock level across all Warehouses and Locations.    For detailed on-hand information click on the adjacent button (Inventory Availability)

 

Sourced By: Display only field showing how this Item is sourced and is taken from the Item master record

 

Re-Order Basis: Display only field showing the basis on which the Re-Order level and Re-Order quantities have been based.

 

Level: Display only field showing the stock level at which the program has evaluated the Planned Supply order.  The field heading reflects the 'Re-Order Basis' selected above and affects the way that Ostendo evaluates the Re-Order level

Level (Qty): The Quantity relating to the Re-Order Level.

Level (Days):  The number of days over which Ostendo has dynamically calculated the Re-Order Level

 

Re-Order: Display only field showing the evaluated Re-Order Quantity .  The field heading reflects the 'Re-Order Basis' selected above and affects the way that Ostendo evaluates the Re-Order Quantity

Order (Qty):  The entered Re-Order Quantity.

Order (Days):  The number of days over which Ostendo has dynamically calculated the average daily usage.  

 

Order Multiple:  Display only field showing the Item’s Order Multiple. 

 

Default Supplier: Display only field showing the Item’s default Supplier.  

 

Lead Time:  Display only field showing the Item’s Lead time.  

 

Sourced By: This is prefilled with the current ‘Sourced Bay’ value held against the Item Master record.   You can amend that and make the amendment specific to these Suggested Orders by clicking on the drop-down icon and making your selection.  The options are

Purchasing - fully purchased Item

Assembly - Assembled in-house

Supplier Assembled - Components sent to Supplier for Assembly

 

Supplier: This is only active if the ‘Sourced By’ selection is ‘Purchasing’.   When active select the Supplier from the drop-down list

 

Override Suggested Qty:  If you change a Suggested Order Quantity then Ostendo will automatically re-calculate the Suggested quantities on subsequent days based upon this new value.  If you do not want this recalculation to take place then ‘check’ this checkbox

 

Projected Requirements

 

This panel shows the day-to-day processing carried out by the Replenishment Run.  It displays all Supply and Demands by day in addition to the Suggested Order Quantity generated during this Replenishment Run.  You have the option to amend the ‘Suggested’ quantity against any day and the program will immediately re-run the Replenishment Process against subsequent records for this Item taking into account the ‘Suggested Order’ change you have just made. 

 

The following fields are display only and cannot be amended

 

Date: Date of the Supply/Demand record

Supply - Opening: Opening stock for this day.  The first day is always the current Stock Level.  Subsequent days take into account the effect of the previous day(s)

Supply - Purchase: Purchase Order quantity expected this day

Supply - Assembly: Assembly Order quantity expected this day

Demand - Sales: Sales Orders quantity required on this day

Demand - Job: Job Orders quantity required on this day

Demand - Assembly: Assembly Orders quantity required on this day

Demand - Forecast: Forecast quantity required on this day

Calculated - Demand: Gross demand for this day

Calculated - Projected: Projected stock (Opening + Supply - Demand)

Calculated - Closing: Closing Balance taking into account the Suggested Order

 

The following field can be amended

 

Calculated - Suggested:  This is the Suggested Order quantity recommended by the Replenishment Run.  You can amend this quantity in which case the program will immediately re-run the Replenishment Process against subsequent records for this Item taking into account the ‘Suggested Order’ change you have just made. 

 

Detail

 

All the fields in this panel are display only and show the Supply and Demand Orders that have been included in the Replenishment Run.  The fields are:

Order Type: Source of the Order (Example Job, Purchase, Sales)

Order Number: Identity of the Order

Required Date: Date when the Order receipt or issue is planned

Name: The Supplier or Customer against the Order

Order Quantity: The current Order quantity

Remaining Quantity: The quantity outstanding against this Order line