Selecting internal suppliers

Distribution planning in Enterprise Planning handles the generation and planning of distribution orders. You can use distribution orders to:

  • Transfer goods between clusters within a logistical site.
  • Transfer goods between sites.
  • Transfer one item into another item.

Distribution planning is very similar to purchase planning. The main differences are:

  • Distribution planning is based on the supplying relationships, while purchase planning is based on item-supplier information.
  • Distribution planning always works with planned orders (also in master planning).

Distribution planning chooses between alternative suppliers and distributes volumes over these suppliers on the basis of the parameters defined in the following sessions:

  • Supply Strategy (cprpd7120m000)
  • Supplying Relationships (cprpd7130m000)

Distribution planning uses supply strategies with supply type Distribution.

Procedure

The supply planning carries out the following steps for each required plan item:

  1. Determine the requirements.
  2. Determine the source of supply (production, purchase, or distribution).
  3. Put the supplying relationships in order of preference.
  4. Determine delivery date by supplying relationship.
  5. Determine the volume by supplying relationship.
Step 1. Determine the requirements.

The master planning engine or the order planning engine determines the required volume and the requirements date.

Step 2. Determine the source of supply (production, purchase, or distribution).

LN determines how much of the requirements is covered by distribution orders on the basis of the sourcing strategy. See Sourcing strategies.

Step 3. Put the supplying relationships in order of preference.

LN orders the supplying relationships in accordance with the priority rule that is effective on the requirements date. Define the priority rule in the Supply Strategy (cprpd7120m000) session.

Step 4. Determine delivery date by supplying relationship.

LN uses various calendars to determine the finish date (delivery date) and the start date (order date). See To compute supply lead-times.

Step 5. Determine the volume by supplying relationship.

LN distributes the required volume over the supplying relationships in the order calculated in step 3. LN generates distribution orders for each planned volume.

This step is carried out in multiple phases. If, after a phase, not all requirements are covered LN proceeds with the next phase.

For an overview of these phases, refer to online manual topic Internal-supplier selection (procedure).

Note

If a plan item has no valid supply strategy, LN uses the following values by default:

If LN cannot find a valid supplying relationship to fulfill a requirement at a certain moment, LN tries to fulfill the required demand with the other supply sources following the sourcing rules that you defined for the plan item in the Sourcing Strategy (cprpd7110m000) session. If LN still cannot fulfill the required demand, LN generates a signal.

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