sop/forecast

[Former Member]

Hai Gurus,

what is the basic difference between SOP and Forecast, pls explain in simple language.

regards,

sekar chand.

[Former Member]

clsoing the thread

[rupesh_brahmankar3]

Dear,

If you do it in forecast in material master usually we use it for raw material where we use consumption based planning with VV.

If you do sales forecast it is used for product and we are doing with a planning stg where we control the consumption.

In SOP, we can control what to consider as consumotion or whether to take last year sales.

In material master it is just a consumption.

In standard SOP, you can forecast the sales quantities of a product group or material. The system bases the forecast on the historical consumption of materials. It then aggregates these results to the product group level.

Hope clear to you.

Regards,

R.Brahmankar

[Former Member]

SOP...considering current sales...

The function of setting the overall level of manufacturing output (production plan) and other activities to best satisfy the current planned levels of sales (sales plan and/or forecasts), is called SOP.... One of its primary purposes is to establish production rates that will achieve managementu2019s objective of maintaining, raising, or lowering inventories or backlogs, while usually attempting to keep the work force relatively stable. It must extend through a planning horizon sufficient to plan the labor, equipment, facilities, material, and finances required to accomplish the production plan. As this plan affects many company functions, it is normally prepared with information from marketing, manufacturing, engineering, finance, materials, etc." ...

FOrecast.....Considering previous sales...

If the sales figures are mot taken into consideration and the if the planning is based on Hhistorical data of sales then it is called forecasting....