Example of Min-Max Planning with Process Manufacturing and Co-Products
This example shows how min-max planning of items with associated co-products can exceed the maximum quantity during a replenishment run.
Min-Max Planning of Items with Co-Products
For this example, let's assume these quantities for each item:
|
Item |
Minimum Quantity |
Maximum Quantity |
In Stock Quantity |
|---|---|---|---|
|
A |
1000 |
5000 |
0 |
|
B |
1000 |
2000 |
0 |
|
C |
750 |
2000 |
0 |
|
D |
750 |
2000 |
0 |
Your company places two work orders:
-
Work Order 1: Product A with a quantity of 1000
-
Work Order 2: Product B with a quantity of 2000
Work Orders 1 and 2 both have co-products associated with them as shown here:
|
Product |
Co-Product |
Requested Quantity |
Min-Max Calculation |
|---|---|---|---|
|
A |
1000 |
1000 |
|
|
B |
500 |
500 |
|
|
C |
500 |
500 |
|
|
B |
2000 |
2000 |
|
|
C |
750 |
1000 |
|
|
D |
750 |
1000 |
Now, here are your resulting min-max totals compared to the previous maximum quantities:
|
Item |
Total Requested Quantity |
Maximum Quantity |
|---|---|---|
|
A |
1000 |
5000 |
|
B |
2500 |
2000 |
|
C |
1250 |
2000 |
|
D |
750 |
2000 |
Note that for Product B, the maximum quantity of 2000 was exceeded. When both work orders for Product A and Product B are factored into a single min-max replenishment run, this scenario of exceeding the maximum quantity can happen. You can get around this by planning one product at a time.