The reorder point is a planning method based on history that is used for spare parts where no bill of material

exists. This method is useful when

you have independent demand items.

Re-Order Point = Demand during Lead time + Max of Safety Stock.

Available Quantity = OHQ + Supply – Demand and

Re-Order Quantity = Re-Order Point – Available Quantity.

In this report, Lead Time is the sum of preprocessing, processing, and postprocessing lead times.

The Reorder Point is the Safety Stock plus the Lead Time Demand.

The On-Hand Quantity is for the organization at the time the report was generated, excluding expired lots.

The Supply Quantity is the current quantity on order, calculated from approved requisitions, approved purchase orders, and intransit inventory.

The Total Available is the On-Hand Quantity plus the Supply Quantity less the Demand Quantity.

The Reorder Quantity is the economic order quantity (EOQ), subject to the minimum order quantity, maximum order quantity, and fixed lot
multiple.

The Demand Quantity is the unsatisfied sales order quantity (reserved and unreserved).

Steps for creating Re-Order Point :

Create an item with Purchased item template Ensure the list price is given as Re-Order Point Planning can be done
only at Org level and not at Sub-Inventory level. List price is mandatory
for pulling the data from the interface tables of purchasing to the base
tables of purchasing ( Requisitions)
Mention the Planning method as Re-Order Point. Order qty of Min and Preprocessing is the time for approving the Purchase order from the
Max can be mentioned to restrict the Min and max levels. moment, the need is felt. Processing is the time for manufacturing at
the suppliers facilities till delivery at gate and Post Processing is the
time taken to deliver the material in Inventory from gate.
We can not define the Forecast set if the planning parameters are not Open the planning parameters in Material Planning – Setup-
defined for the org. Parameters in Manufacturing, Vision Operations responsibility and
change some values and save.
A forecast set can have many forecasts. And a Forecast can have many items.
In the detail button, mention the forecasted qty for various dates. We can manually enter the safety stock requirements under Planning –
Safety Stocks. There will be an enter when SS changes.
We can reload the safety stock as a percentage of the forecast . Tools Choose the method as User defined percentage with safety stock % as
– Reload 50 and forecast as June_08
Review the SS. There is no entry on 24th as there is no change on that Run the re-order point from the navigation for the forecast June_08
day. with restock as Yes.
Reorder point = Demand during Lead time + Max of Safety Stock. In But the re-order qty is restricted to 500 as per the setting in Item
this case it is = 600 + 125 = 725 attribute. Since re stock = Yes, the system has sent the replenishment
data to the interface tables of Purchasing.
Run the Requisition Import concurrent for the Inventory source = INV. The data has reached the base tables ( viewed in Requisition
This will pull the data to the base tables of Purchasing. summary)
 We can visualize the ROQ = 725. While running the re-order point for
If you have no maximum set, then ROQ = ROP subject to the the second time, make Include PO supply and Interface supply as =
minimum. No.
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Best wishes Nana