Forecast Consumption Examples
The following video describes Supply Chain Management concepts and terminology:
The following examples explain using the Forecast Consumption demand source method. For more details about this method, see Demand Planning on Item Records.
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Forecast Consumption Example 1 (Order Falls within Consumption Window)
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Forecast Consumption Example 2 (Order Consumes Forecast Amount)
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Forecast Consumption Example 3 (Order Consumes Multiple Forecast Amounts)
Forecast Consumption Example 1 (Order Falls within Consumption Window)
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Forward consumption is 1 day.
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Backward consumption is 2 days.
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Orders are forecast for 20 units on days 1 and 5.
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An order for 10 units is entered on day 3.
Because the order for 10 units on day 3 falls within the consumption window, 10 units are considered to be consumed. The forecast amount for day 1 is adjusted to be 10 units (20 units originally forecast less 10 units consumed = 10 units).
Forecast Consumption Example 2 (Order Consumes Forecast Amount)
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Forward consumption is 1 day.
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Backward consumption is 2 days.
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Orders are forecast for 20 units on days 1 and 5.
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An order for 30 units is entered on day 3.
Because the order for 30 units on day 3 falls within the consumption window, some units are considered to be consumed.
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Backward consumption is 2 days, so the 20 units on day 1 do fall within the window. The forecast amount for day 1 is fully consumed and is adjusted to be zero units.
(20 units originally forecast less 20 units consumed = 0 units)
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Forward consumption is one day, so the 20 units on day 5 do not fall within the window, and therefore none are consumed. The forecast for day 5 remains at 20 units.
Forecast Consumption Example 3 (Order Consumes Multiple Forecast Amounts)
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Forward consumption is 3 days.
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Backward consumption is 2 days.
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Orders are forecast for 20 units on days 1 and 5.
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An order for 30 units is entered on day 3.
Because the order for 30 units on day 3 falls within the consumption window, some units are considered to be consumed.
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Backward consumption is two days, so the 20 units on day 1 do fall within the window. The forecast amount for day 1 is fully consumed and is adjusted to be zero units.
(20 units originally forecast less 20 units consumed = 0 units)
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Forward consumption is three days, so the 20 units on day 5 do fall within the window. The forecast amount for day 5 is partially consumed and is adjusted to be 10 units.
(20 units originally forecast less 10 units consumed = 10 units).
