How Purchase Orders Are Scheduled

Purchase orders, also known as buy orders, enable you to accurately measure the transit time from the supplier to the organization. The following fields are included on the purchase order schedule:

• Requested Ship Date

• Promised Ship Date

• Requested Delivery Date

• Promised Delivery Date

• Buyer-managed Transportation Indicator

• Shipping Method

Buyer-managed Transportation specifies that the buying company is responsible for arranging the transportation, from picking up the requested goods to delivering to ship-to locations specified in the order. When the Buyer-managed Transportation indicator is not selected, delivery dates are populated on the purchase order and ship dates are not populated on the purchase order. When it is selected, the ship dates are populated on the purchase order and delivery dates may be populated on the purchase order.

When Buyer-managed Transportation is selected, the buyer communicates a requested ship date on purchase orders and the supplier provides a promised ship date in response. When not selected, delivery dates are communicated between buyer and supplier. In both cases, the purchase order also contains shipping method at the line level. Transit times can be defined between a supplier site and organization location for shipping methods. The planning process can consider transit times for purchase orders.

When the planning process creates planned purchase orders, the planning process uses the shipping method from the sourcing rule to calculate the transit time. The total lead time from planned purchase order start date to dock date includes both processing lead time and transit lead time.

When you release a planned purchase order from a Supply Chain Planning work area, the following information is sent to purchasing:

• Shipping method

• Requested ship date

• Requested delivery date

Purchase orders are scheduled backward from the order due date. Scheduling purchase orders respects all valid shipping, receiving, transit, manufacturing, and supplier capacity calendars. In supply chain planning, if any dates are in the past, then the dates are set to the plan start date. The planning process issues reschedule recommendations for the following conditions:

• When the purchase order Buyer-managed Transportation indicator is selected and the old ship date is different from the new ship date calculated by planning.

• When the purchase order Buyer-managed Transportation indicator is not selected and the old delivery date is different from the new dock date calculated by planning.

Example of Backward Scheduling Calculations

Consider that the suggested due date is Day 10, where postprocessing = 1 day, transit time = 2 days, processing = 4 days, and preprocessing = 2 days. The following calculations are used for backward scheduling:

• Suggested Due Date = Day 10

• Suggested Dock Date = Day 9 (Dock Date = Due Date minus Postprocessing Lead Time)

• Suggested Ship Date = Day 7 (Ship date = Dock Date minus Transit Lead Time)

• Suggested Start Date = Day 3 (Start Date = Ship Date minus Processing Lead Time)

• Suggested Order Date = Day 1 (Start Date = Preprocessing Lead Time)