safety stock

[Former Member]

Hi

what is the differance betwen safety stock and minimum safety stock in reorder point planning

waiting for reply

[former_member581212 · Accepted solution]

hi,

> You can specify a minimum safety stock. If the result of the safety stock calculation is lower than this limit, the safety stock is then automatically set to this minimum value. You enter the minimum safety stock in the material master record (the MRP 2 screen).

hope it helps..

Regards

Priyanka.P

[Former Member · Accepted solution]

hi priyanka

i know that but if i not enter the minimum safety stock then

[former_member581212 · Accepted solution]

hi,

If you donot use your minimum safety stovk indicator then ofcourse your forcasting for the material will not be proper...

there will be any limit to the safety stock...

And if we see practically then there shd be some lower limit for storing our safety stocks in the warehouse....so that if there are any delayed del. then these stocks shd be taken into consideration....

hope it helps..

Regards

Priyanka.P

[Former Member · Accepted solution]

Dear,

In the CBP the Safety stock has significant importance in calculating the to be ordered stocks.

Please have a look of the below:

If you are following Manual reorder point planning, an entry in Safety stock is must or if you are following Automatic reorder point planning - the system calculates the safety stock automatically.

Please have a look below:

This function enables you to perform consumption-based planning of parts in MPN-MRP sets. Consumption-based planning is based on past consumption-values and provides an estimate of future requirements with the help of forecasts or statistical procedures. The future requirement is the result of either a shortfall for a defined reorder point or forecast requirements that the system calculates using past consumption values.

· Reorder point planning

In this material requirement planning (MRP) procedure, procurement is triggered when the total of the warehouse stock and the fixed receivables is lower than the reorder point.

The reorder point and the safety stock are central control parameters in reorder point planning. They can be defined by the MRP controller or calculated by the system. Reorder point planning has two different procedures:

¡ Manual reorder point planning

If you want to use manual reorder point planning, you define the reorder point and safety stock in the material master record.

¡ Automatic reorder point planning

If you want to use automatic reorder point planning, the integrated forecast program determines the reorder point and safety stock. The program determines forecast values for the future requirement by using past consumption values. The program calculates the reorder point and safety stock subject to the service level and replenishment time of the part, which have been determined by the MRP controller. The program copies the reorder point and safety stock to the relevant material master record.

The program is executed at regular intervals, therefore the reorder point and safety stock are adjusted to the respective consumption and delivery situations. This contributes to stock reduction.

· Forecast-based planning

Forecast-based planning is also aligned with material consumption. As in automatic reorder point planning, the integrated forecast program determines forecast values for future requirements. As opposed to reorder point planning, however, in forecast-based planning these forecast values create the requirement quantities for the planning run. Therefore, the forecast values are immediately effective as forecast requirements in requirements planning.

The system performs forecasting at regular intervals; it forecasts the future requirements based on past data. This is beneficial, because the requirement, which has been determined automatically, is adjusted to the current consumption pattern. Material withdrawals reduce the forecast requirements; therefore, the system does not re-plan the implemented portion of the forecast requirement.

Regards,

Syed Hussain.

Edited by: Syed Hussain on Sep 24, 2008 10:00 AM

[Former Member · Accepted solution]

hi

thanks all of u for giving answer

regard

sarang m

[Former Member]

Safety stock means the stock which is kept for satisfying the unexpected high demand or fluctuation.

Minimum saftey stock is the lower limit for safety stock.

In forecasting

The lower limit is checked if you use an availability indicator which shows, according to customizing settings, if the safety stock is to be calculated again in a forecast.

If the safety stock is lower than this level in forecasting, the safety stock is automatically increased to the value of the lower level.

[Former Member]

Safety stock

Specifies the quantity whose purpose is to satisfy unexpectedly high demand in the coverage period.

The risk of shortfalls is reduced by having a safety stock.

Minimum Safety Stock

The quantity that defines the lower limit for safety stock. This value cannot be exceeded.

Use

Defining a lower limit can influence the following:

material master data maintenance

The safety is checked to see if it is greater or equal to this lower limit.

forecasting

The lower limit is checked if you use an availability indicator which shows, according to customizing settings, if the safety stock is to be calculated again in a forecast.

If the safety stock is lower than this level in forecasting, the safety stock is automatically increased to the value of the lower level.

regards

points if solved/helpful