In my previous posts, I made a few examples, using different Reordering Policy for the same cases and I presented them as flowcharts. I can make many other examples, but these were represented examples. Maybe someone want some different examples, but if anyone want my help in specific cases, I am available for contact.
Now, I will write a conclusion about this theme – Reordering Policy.
We use Reordering Policy when item quantities must be replenished and when we need to calculate the lot size per planning period (time bucket). You can select from the following reordering policy options:
- Fixed Reorder Qty.: Uses the quantity that is specified in the Reorder Quantity field as the standard lot size. The quantity may be adjusted to meet additional requirements or the specified inventory level. The Reorder Quantity field is used for calculating the overflow level. For more information, see Design Details: Staying under the Overflow Level
- Maximum Qty.: Uses the quantity that is specified in the Maximum Inventory field to determine the maximum lot size. The quantity may be adjusted to meet additional requirements or the specified inventory level. The Maximum Inventory field is used for calculating the overflow level. For more information, see Design Details: Staying under the Overflow Level
- Order: Generates an order for each requirement and does not use the planning period. An automatic reservation between the requirement and the corresponding replenishment order proposal is created. This preserves the customized information on the relevant orders and links them for inventory and costing. Creating a manual reservation is an alternate method for setting aside items in inventory and designating them for use in a specific order.
- Lot-for-Lot: Generates an order proposal with a quantity that meets the sum of the requirements that are due in the planning period.
- Blank: Does not calculate order proposals for this item. You will manually plan for this item.
The final order proposal quantities may be adjusted according to the following order modifier fields:
- Minimum Order Quantity: Defines a minimum allowable quantity for an item order proposal,
- Maximum Order Quantity: Specifies a maximum allowable quantity for an item order proposal,
- Order Multiple: Defines a parameter that is used by the planning system to modify the order quantity of planned supply orders. The order multiple is an integer that defines the quantity to which an order quantity is rounded up. The modified order quantity is then divisible by the order multiple.
This applies when you select the Maximum Qty. reorder policy option. However, if you use the Maximum Inventory field as a restrictive expression of your maximum storage capacity, then you should not use these modifier fields.
If you change to a different reordering policy option, then some planning parameter fields that were previously active and contain the most recently used values may be disabled. Planning calculations will ignore these values.