IBS Supply Plan is used to define how much and when replenishment of items should be made. The supply plan is based on the IC forecast, and the calculated supply plan value can be used as input to the Material Requirements Planning (MRP) in IBS Manufacturing, and for creation of manufacturing and purchase orders. The Supply Plan can also be used as a direct input for creation of purchase suggestions as an alternative to the Re-order-point method. This is called DRP planning. See About distribution requirement planning (DRP).
A manufactured item will usually go through IBS Supply Plan depending on the product mix and type of production. It can also be valid for a distributed item, especially items with long planning time or items that are stored in several warehouses in a hierarchy. It is normally more economical to calculate and do purchasing based on total demand figures instead of working with re-ordering points in each and every warehouse.
It is decided on an item/warehouse level if the item is to be included in a supply plan or not. Input to the supply plan includes the IC forecast, sales and manufacturing orders (demand), safety stock, replenishment orders (Purchase and manufacturing order).
For purchased items the purchase suggestion or internal replenishment suggestion could be based on the Supply plan supply quantity if the planning method Supply plan purchase is used, otherwise the re-order-point planning method is used.
A supply plan will also be the base for manufacturing, as input into MRP calculation (supply forecast). Depending on the planning method, i.e. Supply Plan MRP and planning method MRP, the MRP will handle the supply plan in different ways. For planning method Supply plan MRP the order proposal is created based on the supply forecast, without taking other demand into account, as the calculation is performed within supply plan. For planning method MRP the supply quantity will be netted (adjusted) based on demand (sales) and used as input for the order proposal calculation.
One base supply plan is defined as base and is always considered as the active one, and it is continuously updated when running the job in the IC job calendar.
Forecast adjustment within Supply plan
Functionality is available to cater to situations when:
- sales are made on a seasonal basis, and the sales are significantly higher compared to the replenishment capabilities (i.e. depending on the required workload, sales could exceed the capacity for the period (e.g., during the summer months)).
- working with budget as a Demand plan for next year's forecast, and the budget forecast has not yet been accepted as next year's forecast. (The Demand plan must update the Inventory control forecast before the Supply plan can be created based on the Inventory control forecast). Prior to the new functionality, the inventory control "live forecast" needed to be updated with a budget forecast that had not yet been accepted as next year's forecast.
Production (or purchase) can be done in advance to balance the sales forecast and the replenishment requirements allowing you to have an accurate picture of the stock level. To meet the sales order (forecast), you have the following two possibilities:
- Use a Supply profile
or - Adjust the sales forecast X periods back in time
(The Supply profile and Supply adjustment fields are defined on the Item file/Inventory management panel.)
The forecast adjustment can be done within the Supply plan. When the sales forecast has been retrieved into the Supply plan, the supply quantity is created based on the yearly sales forecast according to the Supply profile set-up if a Supply profile exists for the item. If the item has a Supply adjustment (number of periods) defined, the supply quantity will be "moved" X number of periods.
Creating a supply plan simulation
The Supply plan can be created from the Inventory control forecast or directly from a Demand plan.
- If a Supply plan is created from an Inventory control forecast, the sales forecast is retrieved from the Inventory control forecast and put in the Supply Plan (period by period). The supply quantity (production forecast) is calculated according to the supply profile or supply adjustment and the yearly forecast is then used for creating period supply plan quantity (production forecast). The Supply plan will keep track of how much of the stock is "reserved" for future sales orders by saving historical values in the Supply plan (save previous periods).
- If a Supply plan is created from a Demand plan, (as it should be on a yearly basis in order to calculate Supply quantity in the same way as when created from Inventory control forecast), the Supply plan will keep track of how much of the stock is "reserved" for future sales orders by saving historical values in the Supply plan (save previous periods).
Note: The reserved quantity is calculated according to the supply profile/adjustment in the same way regardless if the supply plan is created from Inventory forecast or a Demand plan.
The Supply forecast is used as input to the MRP and when the item/warehouse has been defined with a Supply profile or Supply adjustment period(s), the MRP calculation uses the production forecast in passed time (calculated by supply plan) as the initial forecast as "reserved stock" to be used for future sales, presented as "reserved forecast" and "Res net forecast". The "Res net forecast" is the adjusted figure based on "reserved forecast" minus sales order in passed time.
When the MRP calculates the proposals the input as initial "stock" is quantity on hand - safety stock - Res net forecast.
Enquiries and printouts
- Supply plan enquiry
From this enquiry you can access information about the supply plan header, the supply plan items, tool allocations and the work centre workload. - SP period definitions printout
- Supply plan list printout
- Supply plan workload report
Related topics
- Supply plan process
- Create the base supply plan version
- Create a supply plan simulation
- Calculate the supply plan values
- Calculate lower level requirements from supply plan
- Maintain the supply values
- Run the IC calculation from the supply plan program
- Create orders from a supply plan
- View the safety stock calculation for a warehouse in a supply plan
- Formula for safety stock calculation in a supply plan
- About distribution requirement planning (DRP)
- About IBS Planning and Forecasting
- About material requirements planning (MRP)