Open source supply chain planning software

Introduction for inventory planners

© 2014 frepple.com

Agenda

Inventory planning workflow Safety stock and reorder quantity calculation Safety stock, reorder quantity and inventory

review and analysis

A day in the life of an inventory planner Cockpit screen Distribution planning screen Inventory and inventory detail reports

© 2014 frepple.com

Inventory planning workflow

Forecast+

Inventory planning parameters

Safety stock

+ROQ

Inventory profile

+Replenishment

plans

Inventory optimization

Plan

Workflow steps:1. Safety stock generation2. Reorder quantity generation3. Safety stock, ROQ and inventory

review and analysis

© 2014 frepple.com

Inventory planning workflow

3 methods are available to compute a safety stock for every time period:

Based on service level A fixed number of months of forecast A fixed quantity

The service level based calculation uses as input Demand forecast Expected customer service level Demand variability Supplier lead time variability

1Safety stock generation

© 2014 frepple.com

Inventory planning workflow

3 methods are available to compute a safety stock for every time period:

Economic order quantity method A fixed number of months of forecast A fixed quantity

Economic order quantity calculated based on Wilson formula uses as input:

Fixed ordering cost SKU forecast Item cost Annual holding cost rate

2Reorder quantity generation

© 2014 frepple.com

Inventory planning workflow

Inventory planners review the safety stock to: Make sure the service levels associated to a SKU are

appropriate and don’t generate too much or not enough stock Set fixed quantities for SKUs where there is not enough demand

history to fully rely on the forecast Set fixed periods of forecast for fast movers to make sure no

stockout will occur …

Inventory planners review the ROQ to: Make sure not to order too frequently from a supplier Ensure the ROQ are not too high generating unnecessary stock

3Inventory planning review

© 2014 frepple.com

Agenda

Inventory planning workflow Safety stock and reorder quantity calculation Safety stock and reorder quantity review and

analysis

A day in the life of a inventory planner Cockpit screen Distribution planning screen Inventory and inventory detail reports

© 2014 frepple.com

Cockpit screen

All users workflows start their work on the cockpit screen

Every user can configure a personal dashboard with the widgets that fit his/her tasks

For an inventory planner the following widgets can be useful:

Inventory by Item Inventory by

location Stockout risk Purchase orders

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Distribution Planning : top section

The distribution planning screen is the main screen for safety stock and ROQ review

The top section displays a grid providing relevant information for current period such as :

Stockout risk Safety stock ROQ Open PO Proposed PO …

© 2014 frepple.com

Distribution Planning : Middle section

The middle section offers many tabs to review the forecast, the plan, the transactions…

In the plan tab, the safety stock, the ROQ, the starting and ending inventory are displayed for current and future periods

© 2014 frepple.com

Distribution Planning : Middle section

The transaction tab allows the planner to:

Review purchase orders and distribution orders needed to obtain the desired inventory profile

Export them to the ERP system

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Distribution Planning : Bottom section

The bottom section allows the planner to modify the stocking policy for a SKU by selecting the method to calculate the safety stock and the reorder quantity.

A checkbox is available if an item should not be stocked.

© 2014 frepple.com

Inventory detail report

The inventory detail report shows all producing and consuming operations for a SKU allowing the planner to understand the exact inventory situation at any time.

© 2014 frepple.com

Other screens used for occasional review and analysis, depending on the inventory planners’ responsabilities:

Other screens

Alerts for excess inventory Identifies item-locations with on

hand level exceeding the planned maximum

Purchase order analysis Review already confirmed open

purchase orders that are critical. You should contact the supplier of critical purchase orders to expedite the delivery.

Purchase order screen Review the proposed new

procurements transactions and export them to the ERP system

Distribution order screen Review the proposed new

distribution transactions and export them to the ERP system

Manufacturing order screen Review the proposed new

manufacturing transactions and export them to the ERP system

© 2014 frepple.com

Try it out yourself

Online demos can be accessed at:

https://manufacturing.frepple.comhttps://distribution.frepple.com

User : adminPassword : admin

Hint:Use the “guided tour” to walk through the “day-in-the-life”

workflows