Consumption Based Planning

(CBP)
Consumption-based planning (CBP) is a materials planning
procedure based on past consumption values that determine future
requirements by
using forecast or other statistical procedures.
Originally, in CBP,
planned independent requirements or dependent requirement will not be
considered
in the net requirements calculation. Instead, it is triggered when stock
levels
fall below a predefined reorder point or by forecast requirements
calculated
using past consumption values. So, all the planned independent or
dependent
requirements in a certain period of time should have been considered
before
(when set the reorder point or calculate the requirement
forecast).
Consumption-based planning procedures are simple materials
planning procedures which we can use to achieve set targets with
relatively
little effort. Therefore, these planning procedures are used in areas
without
in-house production and/or in production plants for planning both B- and C-
parts
and operating supplies.
There are three procedures in Consumption Based
Planning (CBP), which are:
a.Reorder
point planning
In reorder point planning, SAP checks whether the
available stocks are below the reorder point that has been set for the
material.
If they are, SAP will create procurement proposal.
We can determine the
reorder point manually (VB-Manual reorder point planning MRP Type in
standard
SAP R/3) or, it can also be calculated automatically using the material
forecast
(VM-Automatic reorder point planning MRP Type in standard SAP R/3).
The
reorder point should cover the average material requirement/consumption
expected
during the replenishment lead time (procurement processing time +
planned
delivery time + GR processing time). Besides the average consumption,
we also
should consider safety stock. 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 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

In standard SAP R/3 system, besides VB Manual

Reorder Point and VM Automatic Reorder Point MRP Type, there are
also other
MRP Types that have reorder point as its basis to calculate requirement
with
additional procedure which count external requirement (sales order and
manual
reservation) as a requirement. The MRP Type are: V1-Manual reorder
point with
external requirements and V2-Automatic reorder point with external
requirements.
b.Forecast-based
planning
In forecast-based planning, historical data is used in the
material forecast to estimate future requirements. These requirements
are known
as forecast requirements and are immediately available in planning.
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.
This procedure is used in VV-Forecast-based planning MRP Type in
standard SAP R/3.
c.Time-phased materials
planning
In time-phased planning, historical data is also used in the
material forecast to estimate future requirements. However, in this
procedure,
the planning run is only carried out according to predefined intervals. If a
vendor always delivers a material on a particular day of the week, it
makes
sense to plan this material according to the same cycle, in which it is
delivered.
This procedure is used in R1-Time-phased planning MRP Type in
standard SAP R/3.
Besides all procedures that have been explained above,
in SAP R/3 system we can create other procedures according to our own
needs. We
can do it through configuration with SPRO T-code.