Dynamic Safety Stock

[Former Member]

Hello all,

Need some clarifications on dynamic safety stock calculation.

#1. As per the Periods Total screen of MD04 the target stock suggested by system is 240.840.

#2. But procurement proposal was generated only for 120.

Minimum Lot Size: 60

Rounding Value: 60

Questions:

1. Is there any relationship between the available stock (stock in hand) and Target stock ? If so how are they related ?

2. Why VSE requirements are not taken into consideration during daily requirement/dynamic safety stock calculation ? I see the VSF being considered but VSE isn't.

3. How are the coverage dates determined ?

say for example: I have a period range determined in Months. The number of periods is '3 Months' with type being set to '2 - Calendar days'. So if MRP is run today when would the end of coverage range be ?

Since we have months with 31 and 30 days i can't blindly go with 90 days right from the date of MRP run ?

4. Why do we need a dynamic safety stock calculation can't we just go with the static safety stock just by setting up an absolute value in the material master ?

5. Why a dynamic safety stock value has been proposed for requirements that are farther to the range of coverage ? Is this a standard functionality ? Moreover the average daily requirements are different for the requirements farther to the range of coverage ?

How are they proposed ? with the same formula (total requirements/total days in the period) is it ? If so can you help me interpret the same.

Thanks in advance.

Regards,

Rahul

[Caetano · Accepted solution]

Hello Rahul

Firstly, I'd like to ask you to go through the following notes, which explain the range of coverage usage in MRP in detail:

217144  - Range of covrage calc. w/ range of coverage profile

217080  - Documentation: range of coverage in MRP

Please also allow me to explain to you in more detail the range of coverage calculation during the MRP run.

Calculating the range of coverage serves to determine a dynamic safety stock level based on current requirements. Statistical, in this context, means it is not the actual requirements that are taken into account, but the average daily requirements within a defined period that are calculated by the system.

MRP will execute the following procedure:

1 - The system calculates the average daily requirements using the

parameters defined in the range of coverage profile (Please observe

that you have defined period M on your coverage profile)

2 -The system reads the defined ranges of coverage in the range of

coverage profile and calculates the minimum, maximum and target range

of  coverage (see Calculating the Minimum, Maximum and Target Stock

Level and Values of the Statistical Range of Coverage Calculation). The

target  stock level represents the safety stock level.

3 - The system checks for every MRP element whether the available

quantity is below the minimum stock level. If stock falls below the

minimum stock level due to a requirement, the system creates a

procurement proposal and thus calculates the procurement quantity, so

that the available quantity is replenished up to the target stock level.

On first screenshot, the target stock is 240, therefore, the replenishment proposal will be only 120 because the available quantity is already 150. That means, the replenishment proposal plus the available quantity is over the target stock.

Also, the VSE is planned on a different stock segment, that does not consider the coverage profile.

BR

Caetano

[Former Member · Accepted solution]

Hello Caetano,

Thanks for your comments.

Let me take a look at those notes.

You did mention that "VSE's are planned on a different stock segment" so is there any setting's under customization in specific to neglect these requirements ?

Another question:

The type of length as per sap help is "determine the detailed length of the period".

1 - Working days

2- Gregorian Calendar days

I have used 2 here - calendar days meaning that the total number of days should be 90 or 91 or 92 ( 3 months) something in these series - according to my understanding to this function.

But interpreting the planning results i see them calculated differently.

1360/67 = 20.289.

67 is nothing but the number of working days within the 3 month period. Then what is the difference between work days and calendar days pertaining to this context ?

why is it so hard to interpret these planning results ?

would be really gratefull if you could post your thoughts on question's 3,4 & 5.

Regards,

Rahul

[Former Member]

hi Rahul, below link has good details on Dynamic safety stock.

Dynamic safety stock calculation - ERP Operations - SCN Wiki