Safety Stock and Order Modifiers
Safety stock and order modifiers help you translate discrete and repetitive demand into planned orders and repetitive schedules that match your inventory and production policies.
Safety Stock
You can specify safety stock days, together with safety stock percent, as item attributes using the Define Item window in Oracle Inventory. For discretely manufactured items, the planning process calculates the safety stock quantity by multiplying the safety stock percent by the average gross requirements for the period of time defined by the safety stock days.
For repetitively manufactured items, the repetitive planning process multiplies the safety stock percent by the average daily demand for each repetitive planning period. The repetitive planning process calculates the safety stock quantity for each repetitive period across the planning horizon.
Order modifiers for repetitive assemblies work in a similar way to order modifiers for discrete assemblies.
Minimum and maximum order quantities are translated into minimum and maximum daily rates.
Fixed order quantities are translated into fixed daily rates. With fixed daily rates, the repetitive planning process recommends a rate equal to the fixed daily rate or a rate of zero.
Fixed lot multiples are translated into fixed daily rate multiples.
Rounded order quantities are translated into rounded daily rates. Fixed days supply has no real meaning in repetitive environments.
Safety stock and order modifiers are useful when you have repetitive assemblies that report to discrete assemblies or discrete assemblies that report to repetitive assemblies.
Discrete Assemblies with Repetitive Components
You can use safety stock to avoid a stock out for repetitive assemblies. Although your demand should always be satisfied by the end of each planning period, there may be temporary shortages within the period as the schedules build up supply. If you do not want to carry excess inventory in the form of safety stock, you may want to reduce the size and increase the number of your repetitive planning periods. This means that there is less smoothing of supply, resulting in suggested daily rates that more closely match fluctuations in your demand. The best way to avoid shortages within planning periods is to smooth your demand.
Repetitive Assemblies with Discrete Components
If you have a repetitive assembly that has a discretely planned component, then the repetitive planning process suggests planned orders for each day in the period spanned by the repetitive schedules for the assembly. Under these circumstances, you might want to consider using order modifiers, such as fixed days supply, fixed lot multiple or minimum order quantities for the discrete component. This helps to reduce the number of planned orders generated for the discrete component.
