Demand planning

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Contents

• Overview
• Prerequisites
• Calculating current demand
• Calculating replenishment recommendations
• Generating replenishment orders

Overview

Demand planning is the process of calculating the product quantity the company needs to procure or to produce to keep up with the current demand.

Demand planning calculation collects data from the following sources:

• Stock on hand
• Replenishment period
• Outbound documents, which add to the demand:
  • Production orders with the Assembly process type (components)
  • Sales orders
  • Work orders
  • Work in progress (components)
• Inbound documents, which add to the supply:
  • Production orders (finished products)
  • Purchase orders
• Optionally: Reorder point settings

Prerequisites

If you want the Demand planning tool to take into account the minimum and maximum inventory levels, set up Reorder point settings in the product card.

Calculating current demand

To calculate the current demand:

1. Open the Demand planning tool. To do so, in the navigation menu click either of the following:
   • Purchases > Demand planning. The Demand planning window opens with the Replenishment method set to Purchase.
   • Production > Demand planning. The Demand planning window opens with the Replenishment method set to Production.
2. Fill in or select the following:

Field	Description
Demand period	The period that you calculate the current demand for. The start date of the period is always the current date.
Replenishment method	Select a replenishment method to view the demand for products with the same replenishment method specified in the product card.
Supplier	Optional: Select a supplier to view the demand for products that have this supplier specified as the default supplier in the product card. You can manage the list of suppliers in the Counterparties catalog.  To see products from all your suppliers, leave this field empty.
Company	The company that you calculate the current demand for. If you want to allow multiple companies, go to Settings > Company and select the Manage multiple companies checkbox.

3. On the Demand tab, click Calculate.

The result of the calculation appears on the Demand tab for each day of the specified demand period. The result includes the following details:

Column	Description
Product	The product description as it is specified in the Products catalog. To view the demand details, expand a product line. The details include the following: Opening balance. The product quantity on hand on the date. For Shortage and Overdue, the product quantity by the end of the current date. Inbound quantity. The product quantity that the company expects to receive within the demand planning period. To view the contributing documents, expand the Inbound quantity line. Outbound quantity. The product quantity that the company expects to dispatch during the demand planning period. To view the contributing documents, expand the Outbound quantity line. Reorder point. The product quantity specified as the minimum inventory level in the Reorder point settings. Max level. The product quantity specified as the maximum inventory level in the Reorder point settings. Closing balance. The product quantity on hand by the end of the date. For Shortage, the product quantity on hand by the end of the demand planning period. Closing balance is calculated by the formula: Closing balance = (Opening balance + Inbound quantity) – Outbound quantity
Variant	A variation of the product, for example in color or size, as it is specified in the product card.
Shortage	The product quantity the company needs to procure or produce to meet the demand by the end of the demand planning period. Shortage arises in the following cases: If the reorder point settings are specified and the Closing balance is less than or equal to the Reorder point. In this case, the shortage is calculated by the formula: Shortage = Max level – Closing balance The reorder point settings are not specified and the Outbound quantity is greater than the Inbound quantity and the Opening balance together. In this case, the shortage is calculated by the formula: Shortage = Outbound quantity − (Opening balance + Inbound quantity) Documents that contribute to Outbound quantity: Production order (consumed components) Sales order Work order Work in progress (consumed components) Documents that contribute to Inbound quantity: Production order (finished products) Purchase order
Overdue	The total product quantity the company needed to procure or produce to meet the demand by the current date. Overdue quantity is calculated by the same formulas as the shortage quantity providing that it includes data only from the documents whose fulfillment date is past due.
<Date>	A date within the demand planning period. Opening balance is equal to the closing balance of the previous day. For the first date of the period, it is equal to the closing balance in the Overdue column. Inbound quantity is the product quantity due to be received on the <Date>. Outbound quantity is the product quantity due to be issued on the <Date>. Closing balance is calculated by the formula: Closing balance = (Opening balance + Inbound quantity) – Outbound quantity

With demand planning, you can quickly create multiple purchase or production orders. To learn more, see Calculating replenishment recommendations and Generating replenishment orders.

Calculating replenishment recommendations

After you have the current demand data, you can generate a list of replenishment recommendations to cover the demand.

Replenishment options can include the following orders:

• Purchase orders.
• Production orders. To enable Production orders, go to Settings > Accounting settings > Production and select the Enable Production subsystem checkbox.

From the recommendation list, you can select the required products and generate the replenishment orders in one click.

To generate replenishment recommendations:

1. Select the Recommendations tab.
2. Select the Show recommendations option:
   • Select For period end date if you want to see the aggregated replenishment orders at the end of the specified demand period. In this case, the calculation ignores shortages within the period.
   • Select By dates within period if you want to see the replenishment orders issued before the date the shortage occurs. The order date is calculated by the formula:
     Order date = Shortage date – Replenishment period
3. Click Calculate.

The list of recommendations includes the following details:

Column	Description
Product	The product description as specified in the Products catalog. To view the recommended replenishment options, expand a product line.
Variant\Source	For a Product line, contains a product variant. For a Purchase order line, contains the product variant default supplier.
Receipt date	The date when you will receive the product according to the suggested order. This date is populated to the orders generated on the Orders tab. For details, see Generating replenishment orders.  The Receipt date is automatically determined by the following steps: Calculate the receipt date by formula: Receipt date = Current date + Replenishment period from a product card. On the Demand tab, find the date when the product shortage occurs. Compare the two dates and select the latest one. This is the Receipt date. For example, the current date is 6/27/2023, Replenishment period is three days, and the product shortage occurs on 6/29/2023. Then the Receipt date is 6/30/2023.
Quantity	The demanded product quantity.
Price	The price the default supplier charges for the product. The product prices are specified in the Counterparty prices section in the product card.
Amount	The amount payable as per the replenishment order.
Currency	The supplier price currency.
Price type	The supplier price type. To learn more, see Supplier price types.

To expand all product lines, click Show details. To collapse all product lines, click Hide details.

To select all orders whose default replenishment method matches the replenishment method specified in the header of Demand planning, click Select default orders. To clear the selection from all orders, click Clear order selection.
Note. If you calculate recommendations For the end of the period, and by that date the demand a replenishment order covers is overdue, such order won't be selected when you click Select default orders.

Generating replenishment orders

After you have calculated replenishment recommendations, you can generate replenishment orders. To do so, do the following:

1. Select replenishment orders and go to the Orders tab.
2. Optionally: Click Settings and in the window that opens choose the options you need:
   • Set order status to In progress. Select this checkbox if you want to set the status of the replenishment orders to In progress.
   • Post orders automatically. Select this checkbox if you want 1C:Drive to try to post the replenishment orders. Please note that orders that are missing required data will not be posted.
   • Include in production planning. Select this option if you want 1C:Drive to add the replenishment orders to the production queue.
   • Generate orders by supplier. Select this option if you want to consolidate orders with the same price, receipt date, and supplier (for Purchase orders) or manufacturer (for Production orders).
3. Click Generate orders.

The replenishment orders appear on the Orders tab. To edit order details, double-click the order line. To learn more, see Purchase orders or Production orders.

To view and manage the upcoming dispatches, click Goods dispatching.

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