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Former Member

Optimizer plans safety stock for distribution demand doubling safety cover

Hi

We have a situation that is easy to solve using standard MRP but we are struggling to find a solution for in the SNP optimizer and I'm hoping someone here may be able to help.

We have a manufacturing plant that has it's own warehouse and distributes stock directly to the customer. It also manufactures the same product for distribution to the customer via external warehouses.

All warehouses that supply to customer need to hold a safety stock to ensure that customer demands can be met. This is a time-based safety stock so future demand is automatically taken into account.

The issue that we have is that the external warehouses are holding a safety stock (as expected) and raising purchase requisitions against the manufacturing plant (as expected). The manufacturing plant is then taking these purchase requisitions into account when calculating it's own safety stock and therefore holding stock not only to cover 2 weeks of customer demand, but also the requisition demand from the external warehouses. This means that we are in fact holding double safety stock for any demand through the external warehouse (i.e the expected 2 weeks cover at the distribution site, and a further 2 weeks at the manufacturing site.)

In standard basic ECC planning this is not a problem as on the MRP2 tab for the plant / material there is a safety time indicator that lets you ser a safety time against all requirements or only for independent requirements. Where is the equivalent for the SNP optimizer?

I did find a post from 2009 that relates to this and makes hint of a parameter that could possibly be used to achieve this (GLOBALSAFETYMETHOD) however I can't find any further info on this parameter.

Thanks in advance for your assistance with this,

Regards

-Andy

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1 Answer

  • Best Answer
    Apr 04, 2016 at 01:39 PM

    Hello Andy,

    Yes this is peculiar of SNP, not only in Optimiser but also in Heuristic. The Safety Days supply which is specified is for the product location and there no setting similar to " safety time indicator" as in ECC to control the supply elements.

    In past we had a similar requirement from one of our clients, we proposed them to choose from the below two options,

    1. Every month/Quarter/Year calculate the proportion of distribution demand to the Forecast demand at the manufacturing locations and adjust (lower) the safety days of supply for the manufacturing location by that factor with respect to what was the original target. This is a simple and practical approach.

    2. Since SNP optimiser finally considers the safety stock key figure calculated via macro in the planing book, adjust the macro to do custom safety stock calculations by looking at the location type.

    Fortunately, for us client accepted the first proposal with a automation program to update the safety days value in product master, we didn't get to experiment on the other suggestion. I think that also might work.

    you can have a look at Restrict SNP safety stock planning scope | SCN for more pointers towards the macro adjustment.

    Global Safety Stock Fallback Value is used in SSP not sure if it might help in SNP optimiser engine.

    Regards,

    Abhishek Rai

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