Order Modifiers
Order sizing is a set of item attributes that allow you to control the recommended order quantities for planned orders. The planning process creates planned orders using basic lot-for-lot sizing logic.
Attention: The planning process ignores order modifiers for items that have a phantom supply type. See: Supply Types.
Lot-for-lot generates planned orders in quantities equal to the net requirements for each day. To modify the lot size recommended by the planning process, you can use several different order modifiers.
Your company may have order policies for dependent demand items that differ from the lot-for-lot order sizing technique. You can express your company's order policies for these items using order modifiers. Order modifiers regulate the size and timing of planned orders, both discrete (quantity) and repetitive (rate).
For a given inventory item, you can establish order quantities as fixed or variable.
Fixed order quantity fixes the size of the order, but the time interval between orders depends on actual demand.
Variable order quantity policies include: fixed lot multiple, minimum and maximum order quantity, and fixed days supply.
Fixed Order Quantity
The planning process places one or more orders for the user-defined quantity or repetitive rate.
- For discretely planned items, when the requirement for a given date exceeds the fixed order quantity, place multiple orders.
- For repetitively planned items, either recommend a rate equal to the fixed order quantity or a rate of zero.
Fixed Lot Multiple
The planning process places single orders in quantities that are multiples of the user-defined quantity or rate.
For example, when the fixed lot multiple quantity is 100 and the requirement equals 110 units, place a single order for 200 units.
Minimum and Maximum Order Quantity
The planning process places one or more orders for at least the minimum quantity, but no greater than the maximum quantity.
For discretely planned items, when the requirement for a given date exceeds the maximum order quantity, the planning process places multiple orders.
Fixed Days Supply
The planning process places single orders for the quantity that covers the requirements for the user-defined number of days. When suggesting planned orders, the planning process looks forward this many days and accumulates all of the demand in that time period. It then suggests a planned order to satisfy the total quantity required for that time period.
Rounding Order Quantities
You can define, for each inventory item, whether the planning process should round order quantities when the actual order quantity is calculated as a fraction. If you choose to round, order quantities are rounded to the next highest whole number.
Attention: By rounding up, the planning process may suggest a planned order for more than what is actually needed. This extra quantity is carried over into the next period as supply.
The following diagram shows the logic that the planning process uses when planning with order modifiers.
See Also
Defining Items
