How Average Daily Demand Is Calculated in Oracle Replenishment Planning
This topic explains how average daily demand is calculated in Oracle Replenishment Planning.
Settings That Affect Average Daily Demand
The following settings affect the calculation of the average daily demand:
-
Whether the history or forecast is to be considered
-
Whether policy parameters or segment-level defaults have been defined in the policy assignment set for a replenishment plan
How Average Daily Demand Is Calculated
How average daily demand for an item-location combination is calculated depends on whether you selected History or Forecast in the Days of Cover Basis field on the Policy Parameters subtab for the policy assignment set.
Selection in Days of Cover Basis Field |
Calculation of Average Daily Demand |
Example |
---|---|---|
History |
These steps are taken:
|
The horizon for the average daily demand is 30, and the calendar is open on all days. The shipment history is 600. The extrapolation percentage is 15. This calculation provides the average daily demand: 600/30 + 15% of (600/30) = 20 + 3 = 23 |
Forecast |
These steps are taken:
|
The gross forecast for the next 20 days is 500. The number of days is 20, and the calendar is open on all days. This calculation provides the average daily demand: 500/20 = 25 |