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Requirements Planning in IS-Retail

Purpose

Requirements planning involves ensuring that goods are available when recipients (stores or customers)

and consumers require them. The quantities required have to be procured in good time. The following

activities are required:

• Monitoring the stock 

• Taking sales and purchase orders of recipients into account

• Creating forecasts

• Calculating requirement quantities

• Creating followon documents for procuring the merchandise

The stock planner has to define the suitable forecast! requirements planning and lot si"ing procedures for

each article.

The logistics concept underl#ing $%& Retail supports the following processes:

'

irect deliver# (thirdpart#)

The vendor delivers direct to the recipients. n this case! purchase orders are placed b# either the

recipient or the distribution center.

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eliver# via the distribution center 

The vendor delivers to a distribution center. The distribution center handles all further supplies to

the recipients. $upplies can be handled as follows:

&utawa#*removal from storage

The goods are put into storage following goods receipt and later removed from storage for

deliver# to the recipients.

Crossdocking*flowthrough

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The goods are not put awa#! but flow through and out of the distribution center. n the case of

crossdocking! entire shipments (such as full pallets) are brought from the goods receipt "one to

the goods issue "one.

n the case of flowthrough! the shipments are broken down into smaller units before the# can be

assigned to a particular recipient (for e+ample! when a recipient is onl# to receive half a pallet).

Requirements Planning: Supply Source Determination

Use

n Requirements &lanning! the s#stem uses the suppl# source determination function to decide how to

 procure merchandise. The s#stem finds either a distribution center (an internal source of suppl#) or a

vendor (e+ternal source of suppl#).

Supply Source Determination

Purpose

The suppl# source determination function is used to assign sources of suppl# to requirements. This takes

account of both internal sources of suppl# (distribution centers) and e+ternal sources of suppl# (e+ternal

vendors).

The $#stem uses source determination! for e+ample! in Requirements &lanning! ,rdering! %llocation and

$tore ,rder functions. -ach application can control how the suppl# source determination proceeds and

anal#"e the results differentl#.

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Prerequisites

# using the suppl# source indicator in the article master logistics data! #ou can define whether it is

 preferable for the s#stem to search for an internal or an e+ternal source of suppl#. $uppl# sources can be

defined in the s#stem as follows:

• $uppl#ing sites in the site master 

/ou can define internal suppl# sources b# entering one or more suppl#ing sites in the site master

data. /ou have the option of assigning the suppl#ing sites to sites at the merchandise categor#

level or to entire assortments.

/ou can enter a validit# period and a priorit# for each suppl#ing site. &riorities enable #ou to

select a suppl#ing site if various valid suppl#ing sites e+ist for a particular period.

• &urchasing information record

&urchasing information records define internal or e+ternal sources of suppl#.

• ,utline agreements

The s#stem evaluates the outline agreements that e+ist in the s#stem when determining suppl#

sources. %n outline agreement can be related to an e+ternal source of suppl# (for e+ample! value

contracts) or an internal source of suppl# (for e+ample! stock transport scheduling agreement).,utline arrangements with suppliers can be viewed via the purchasing information record! even if 

outline agreements do not e+ist.

• 0uotas

0uotas are used ver# rarel# in retail. 0uotas can be used to define various internal or e+ternal

sources of suppl# to which procured merchandise is to be distributed using quotas. /ou can also

enter outline agreements as sources of suppl#. /ou can use quotas! for e+ample! that cannot be

supplied b# a sole vendor because demand is too great.

f relevant quota arrangements e+ist! the s#stem checks in Customi"ing if the quantit#

required has to be split among different sources of suppl# (quota arrangement split). Thequantit# required is then split up among several suppl# sources in line with the quota

arrangements.

• $ource lists

$ource lists are used ver# rarel# in retail. /ou can assign internal or e+ternal sources of suppl#!

including validit# periods! to a combination of articles or sites. /ou can also enter outline

agreements as sources of suppl#. /ou can use source lists! for e+ample! as a finetuned control for 

determining sources for particular articles.

Process Flow

The s#stem proceeds as follows:

1. -valuate quota arrangements

Refer to

$ource etermination: -valuating 0uota %rrangements

  -valuate source lists

Refer to

$ource etermination: -valuating $ource 2ists

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  -valuate search sequences in the article master 

Refer to:

$ource etermination: 3inding -+ternal or nternal $ources of $uppl#

• etermine e+ternal sources of suppl#

• etermine internal sources of suppl#

%s soon as the s#stem has found at least one valid source of suppl#! it ends the search and uses the sourceof suppl# it found as the search result.

f #ou carr# out source determination online and the s#stem finds more than one possible source of

suppl#! #ou will receive a window containing the s#stem suggestions. /ou can onl# select one source of

suppl#.

f #ou carr# out suppl# source determination in the background! the s#stem must determine a clear source

of suppl# so that the s#stem can then generate a purchase order automaticall#.

Requirements Planning: Forecast

Use

% forecast of future requirements! based on past consumption figures! is needed to support some

requirements planning methods. n some cases! the forecast is compulsor#! in others! it is used to provide

additional! optional information. The forecast is carried out before requirements are planned. -+amples of 

areas in which a forecast is used are:

'

Timephased planning

/ou must carr# out a forecast before requirements are planned! as this is the onl# wa# to

effectivel# cover requirements up to the ne+t date on which requirements are planned.

'

%utomatic reorder point planning

n this process! #ou are advised to carr# out a forecast before requirements are planned. The

s#stem uses the results of this forecast to calculate the current reorder point and safet# stock on

the basis of a service level entered b# #ou.

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Replenishment

3or replenishment! #ou onl# need to carr# out a forecast if #ou use a d#namic target stock based

on a target range of coverage and a forecast requirement.

Features

% number of forecast models are available for the forecast! such as constant! trend! and seasonal models!

as well as models for moving average values and weighted moving average values. /ou can assign a

forecast model manuall#! or have the s#stem determine one.

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/ou control the forecast in the logistics data of the article master b# maintaining parameters such as the

number of historical periods and factors for e+ponential smoothing.

f #ou make the appropriate settings in the forecast data of the article master! #ou can ensure that

consumption figures for promotional goods are smoothed for the forecast b# the creation of an averagevalue. n this process! a group of related promotional periods is first determined. The consumption values

in these promotional periods are then replaced b# the average consumption value of the periods either

side of the promotion.

/ou can simplif# master data maintenance b# creating a forecast profile containing parameter values that

come up again and again! and then assigning this profile to several articles. /ou can also cop# forecast

data for a new article master from a reference article.