How should we plan supply for our seasonal products?

[ann_hustis]

In our lumber manufacturing industry we build inventory from October to April; sales during this period are low. From May to September we are in high selling mode. And of course, we continue to build extra inventory during these months. We plan demand in the IBP system and send it to S/4.

Planning strategy 11 Gross Requirements Planning works perfectly from October to April; we build inventory without considering the current stock level.

But from May to September we might oversell the forecast and therefore run out of stock of some products. But we cannot see this in MRP. In classic Strategy 11, sales orders are not considered as demand; only the BSF requirements are demand. And by the way, we cannot hold dynamic or static safety stock to buffer for this; it would be way too much.

How do other companies solve this seasonal planning problem?

Here are the solutions we’ve thought of, but I’d like to hear how you have solved this problem.

1. Switch from planning strategy 11 to 40 during May to September and switch back again to strategy 11 in October. But this requires mass changing materials and deleting the entire forecast and re-creating it. Seems awkward!
2. Create a custom report that monitors upcoming sales orders, deliveries, stock and planned supply and use this report to enter manual BSF requirements. Again, this seems awkward.

Have you solved this problem? And if so, how?

Thank you very much.

Regards, Ann

[former_member801865 · Accepted solution]

Hello Ann,

My recommendation: Create a new strategy Z**, then change the customizing whenever you need it, so the req. type will remain the same. I guess you use PIRs.

Kind Regards

[Caetano]

Hello Ann and Xavier

I'm not sure if changing the planning strategy customizing is a good idea, because it might generate inconsistencies and problems in sales orders and PIR consumption (inconsistencies in sales orders were the most frequent cause of issues in MRP when I worked in SAP Product Support years ago).

The planning strategy requirement type/class settings are used by the sales order to generate the records in table VBBE, and these records are read by MRP to determine if a sales order is relevant to MRP and it if should consume PIRs. If you change the settings of the planning strategy, it is hard to predict what will happen with existing sales orders and independent requirements.

Perhaps it would be a good idea to create an enhancement in the sales order with a logic to automatically determine the requirement type based on the season. You can create a custom table where you determine which requirement type will be used in each season and the enhancement can determine it automatically.

If you decide to proceed with the idea of changing the planning strategy customizing, you need to test if very very carefully, to make sure that there won't be any problems with the sales orders and with PIR consumption/reduction.

Regards,
Caetano

[ann_hustis]

Hi Caetano, Yes Xavier and I agreed that we will use the standard KSL and KSV requirements types and we will have a user exit toggle which one will be placed in the sales order item (during manual VA01 or using EDI). The user exit will look to a custom table just as you suggested.

Thank you so much for your help. Both you and Caetano!

Best regards,

Ann

[former_member801865]

Hello Caetano,

I totally agree with you, it is always better to use the standard ones, to avoid potential issues and also to avoid changing existing sales orders and PIRs.

Kind Regards

[Caetano]

Hi Ann

You don't really need to switch between planning strategies, because you can build a strategy group that includes both planning strategies.

You just need to make sure you create planned independent requirements using a different requirement type between may and september, and make sure that sales orders are created using the respective requirements type.

Regards,
Caetano

[ann_hustis]

Thanks very much for your answer, Caetano. About 60% of our sales orders come in via EDI. How can we control which requirements type they adopt? Won't they always adopt the requirements type of the leading strategy within the strategy group? And we would have to rely on the customer service agents to toggle the sales order items to the correct requirements type for half the year; is this right?

Thank you!

Best regards,

Ann

[preiss_consulting]

Using only strategy 40 with long backward consumption interval, between 6 and 12 months ?

[ann_hustis]

Thanks Xavier. I did check with our EDI team and they said that they could change the interface program to change the requirements type seasonally. BUT the Customer Service manager said that there was no way the customer service agents (who enter sales orders) can be counted upon to toggle the Requirements type in the Sales Order item during the "other" season.

[former_member801865]

Hello Ann,

But EDI team most probably can influence via User Exit the requirement according to your requeriments, so your agents do not need to key in the requirements type manually.

Thanks and Kind Regards

[ann_hustis]

Thanks very much, Xavier. This is a great idea! Thank you for all of your detailed explanation.

Best regards,

Ann

[ann_hustis]

Thanks Xavier but we want the behavior of the requirements type/class to differ in the 2 seasons. We want KSV Warehouse consumption during the selling season and we want the KSL Sale from Stock during the building season. So we can't create a single requirements type/class that will do both.

[former_member801865]

Hi Ann, what I would do is to customize a new strategy that allows to use both types of requirement types, then adjust your interface program with the logic of Oct - Apr KSV / Apr - Oct KSL making use of programming in case needed.