IRT330_46C_Col13_NW

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

Irt330 Requirements Planning and Buying

IRT 330

Requirements

Planning and

Buying

Requirements

Planning and

Buying

! System R/3 ! Release 4.6C ! April 2001 ! Material number 5004 6260

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

Copyright 2001 SAP AG. All rights reserved.

No part of this publication may be reproduced or transmitted in

any form or for any purpose without the express permission of

SAP AG. The information contained herein may be changed

without prior notice.

All rights reserved.

Copyright

Trademarks:

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AS/400®_{, OS/390}®_{, and OS/400}®_{are registered trademarks of IBM Corporation.}

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

SAP Retail

Pricing in SD LO620 3 days

Level 2

SAP Retail Process Overview

IRT100 5 days

SAP Retail Master Data

IRT310 3 days Consumption-Based Forecast LO525 2 days Purchasing Details/Optimization LO520 3 days Pricing in Purchasing LO521 2 days Sales LO605 4 days Invoice Verification LO515 3 days Cross-Application Business Processes in SD and MM LO925 2 days Shipping LO610 2 days Billing LO615 2 days Transportation LO611 3 days Basic Processes in Wareh.Management LO530 5 days

Level 3

SAP Retail Pricing and Promotions

IRT320 3 days

SAP Retail Buying

IRT330 3 days

SAP Retail Supply Chain Management

IRT340 3 days

SAP Retail BW/MAP

IRT350 3 days

SAP Retail Store Connection

IRT360 3 days

SAP Retail Store

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

#

Basic knowledge of retailing

#

Required: IRT100 – Retail Process Overview

#

Recommended: IRT310 – Retail Master Data

Course Prerequisites

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

Target Group

#

Participants:

! Project team members

! Employees with organizational and IT

responsibilities

! Consultants

#

Duration: 3 days

User notes

! These training materials are not a teach-yourself program. They complement the explanations provided by your course instructor. Space is provided on each page for you to note down additional information.

! There may not be sufficient time during the course to complete all the exercises. The exercises provide additional examples that are covered during the course. You can also work through these examples in your own time to increase your understanding of the topics. <Use standard RTF object>

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I n t e r n a l U s e S A P P a r t n e r O n l y

!

Course Goal

!

Course Objectives

!

Course Content

!

Course Overview Diagram

!

Main Business Scenario

Course Overview

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

This course will prepare you to:

!

Make the system settings required for all

purchasing activities in a SAP Retail system.

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

At the conclusion of this course, you will be able to:

!

Make the settings needed to carry out processes

relating to merchandise procurement as

effectively as possible.

Course Objectives

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

Unit 4

Subsequent

Settlement

Unit 5

Vendor Evaluation

Unit 6

Conclusion

Unit 1

Course Overview

Unit 2

Requirements Planning

Unit 3

Ordering

Preface

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I n t e r n a l U s e S A P P a r t n e r O n l y

1

2

3

4

5

6 Course Overview

Requirements Planning

Ordering

Subsequent Settlement

Vendor Evaluation

Conclusion

Course Overview Diagram

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

!

Your company has decided to implement SAP

Retail and you are responsible for all purchasing

activities.

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I n t e r n a l U s e S A P P a r t n e r O n l y

!

Requirements planning

!

Investment buying

!

Perishables

!

Replenishment

!

Allocation table

Requirements Planning

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

!

Describe the various requirements planning

procedures and make the necessary system

settings

!

Use investment buying and perishables planning

(special requirements planning cases)

!

Explain the basic concept of replenishment

!

Distribute merchandise using an allocation table

At the conclusion of this unit, you will be able to:

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I n t e r n a l U s e S A P P a r t n e r O n l y

1

2

3

4

5

6 Course Overview

Requirements Planning

Ordering

Subsequent Settlement

Vendor Evaluation

Conclusion

Course Overview Diagram

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

!

You carry out requirements planning for your

merchandise at regular intervals in the warehouse.

You use the vendor as one selection criterion for

the articles for which requirements planning is to

be carried out.

!

As a result of these activities, you have purchase

requisitions, which can be converted into purchase

orders.

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

!

Make the most important settings for

requirements planning and carry out various

requirements planning runs.

!

Perform the following activities:

"

Make settings in the master data

"

Maintain planning calendars for time-phased

planning

"

Carry out a requirements planning run

At the conclusion of this topic, you will be able to:

Requirements Planning: Topic Objectives

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001 Merchandise Requirement Merchandise Merchandise Vendor

Vendor _Requirem. Dist. centerDist. center _Requirement _Store_Store

!

Automatic processes for supplying merchandise at site level

!

Monitoring stocks in a site

!

Centralized and local use

Requirements Planning: Purpose

" The main purpose of requirements planning in retailing is to monitor stocks and automatically generate procurement proposals for Purchasing. This aim is acheived using various requirements planning procedures.

" Both the use of a centralized purchasing policy, with ordering in the hands of the head office alone, and purchasing (partial or complete) at a local level are supported by the system.

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

Requirements planning: Overview

RP type Requirements planning Consumption values 10/2000 987 11/2000 1000 12/2000 1251 Purchase requisition Item 10 Item 20 Purchase Order Item 10 Item 20 Forecast indicator

?

Articles Articles Forecast Perishables IB Replenishment

" The RP type plays a key role in requirements planning. It controls whether a forecast needs to be carried out or not.

" A purchase requisition is normally generated as the result of requirements planning.

" Exceptions to this are planning requirements for perishables, Investment Buyer and replenishment. You can also create purchase orders from these particular processes.

" Assignment of the RP type takes place in the article's logistics view.

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001 Logistics view RP type Automatic reorder point planning Reorder point of safety stock Forecast Forecast Future requirements Time-phased

requirements planning Replenishment

Requirements Planning: Forecast

Articles

Forecast

Future requirements for dynamic target

stock

" For articles planned using automatic reorder point planning, the reorder point and safety stock can be checked for each forecast run and the expected requirement adjusted accordingly.

" For articles planned using time-phased and forecast based planning, the forecast estimates the future requirements directly.

" If the target stock has to be determined dynamically, a forecast is needed for replenishment. " The following forecast models are possible:

• Constant model • Trend model • Seasonal model • Seasonal trend model

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I n t e r n a l U s e S A P P a r t n e r O n l y

Manual

Models Parameters

Automatic Model selection

Automatic

T: Test for trend S: Test for season A: Test for trend and season

Manual model selection with additional automatic test

Selection

Requirements Planning: Model Selection

" Before the first forecast, you must define the model the system is to use to determine forecast values. You can select the model as follows:

• Manually • Automatically

• Manually, with an additional, automatic test

" If you want to select the forecast model manually, you must first analyze the consumption sequence. This method is advised for mass articles.

" With automatic model selection, you can make system settings that have the system analyze the consumption sequence and select the model that best forecasts future consumption. For reasons of performance, you are advised to only use this method for selected articles.

" In the case of manual selection with the additional, automatic test, you enter a model manually, and have the system look for the trend, season, or seasonal trend.

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001 R2 Planning data RP type Customizing RP type Forecast

+

Forecast data Forecast model Period indicator Consumption values 03/00 02/00 01/00 1253 1178 1182 Article R100000 Site R300 Articles

Requirements Planning: Prerequisites for the

Forecast

" If you want to carry out the forecast for an article, you must first define the forecast data for this article in the article master.

" A forecast can only be carried out if historical consumption values exist for the article. The system generally updates consumption values in the article master when stocks are removed from the warehouse, and these values can be checked and if necessary corrected before the forecast is carried out. In addition, it is possible to enter historical consumption values manually as the base values for the first forecast.

" If the consumption statistics required for the forecast are not yet available for an article, it is possible to carry out a forecast with reference to another article.

" The results of the forecast are then used requirements planning if the forecast indicator is selected in Customizing for the RP type.

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I n t e r n a l U s e S A P P a r t n e r O n l y

© SAP AG IRT330 2-11  SAP AG 2001 Consumption values 110 105 92 ... Article R100000 Forecast model T Forecast values Period 01: 116 02: 122 03: 128 ... Model initialization Determination of Model parameters e.g. base value trend value Parameter optimizing Optimizing of smoothing factors Forecast Ex-post forecast Forecast for past periods

Requirements Planning: First Forecast

" For the first forecast for an article, the necessary model parameters (base value, trend value, season indices) are determined for the relevant forecast model. This model initialization happens

automatically and must be carried out again if the forecast model used ceases to be valid " Parameter optimizing is used to optimize the smoothing factors. The system searches through

various parameter combinations and selects the one with the lowest mean absolute deviation. " The ex-post forecast is a forecast for historical periods. Consumption values are forecast on the

basis of historical consumption values and compared with actual consumption values, so that the model parameters are adjusted in line with actual consumption as effectively as possible.

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

Requirements Planning: Ex-Post Forecast

Consumption Historical values Time Number of forecast -values Forecast values Number of historical-values

Ex-post forecast Forecast Number of historical

-values for initialization

" For the initial forecast, the system carries out an ex-post forecast if more historical values are available than are needed or should be used for initialization. The series of historical consumption values is split in two. The first set of values, that is, the earliest group of values, is used for model initialization. A forecast is carried out for the second set, which means that forecast values are calculated for the past period and compared with the actual consumption values. This ensures that the model parameters are better adjusted to most recent developments.

" The ex-post forecast is used:

• for models with exponential smoothing • to optimize parameters

• if forecast periods are intentially omitted • to evaluate the quality of the forecast

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I n t e r n a l U s e S A P P a r t n e r O n l y

© SAP AG IRT330 2-13  SAP AG 2001 Interactive forecast List Site Stock planner Values Messages Site Stock planner Error class Background forecast Check forecast values and messages Carry out forecast

Maintain historical values

Follow up List Start

Requirements Planning: Steps in the Forecast

" There are various ways of carrying out the forecast for articles. • Individual forecast (interactive/not interactive)

• Complete forecast (online/in the background)

" The interactive individual forecast is triggered on the Forecast screen in article maintenance. The forecast settings can be changed online as required before the result of the forecast is stored. An interactive graphical feature is available for checking and changing the forecast values.

" A complete forecast is carried out for a particular site and period indicator. To keep system load as low as possible, you are advised to carry out a complete forecast in the background. Once the forecast run has finished, you get a list of all articles for which the forecast was carried out, providing you selected the Log record indicator. If you did not select this indicator, a list is not created.

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001 Forecast for... Individual forecast Complete forecast online online or in the background Carried out... one article in one site all articles in one site

Requirements Planning: Carrying Out a Forecast

" In SAP Retail, there are two ways of forecasting future requirements of articles in sites: • Individual forecast

Here, the consumption for one article in one site is forecast online. • Complete forecast

Here, the consumption for all articles in one site, or all sites, is forecast. You can do this online or in the background.

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

Manual correction of consumption values

and forecast values

Fixing of forecast values

Limiting the series of historical values

Promotion smoothing

User exits

Requirements Planning: Influencing the Forecast

" You cannot manually change the historical values updated by the system directly. Instead you must change them by using correction values. You may need to do this in the case of outliers, for example.

" You cannot manually change the forecast values calculated by the system directly either. You must change these, too, using correction values.

" A fixing indicator is automatically set for corrected forecast values. This indicator ensures that the correction value is not changed by subsequent forecast runs.

" Forecast values can also be fixed manually. As a result, these values are not changed by subsequent forecast runs.

" You can enter the number of historical periods that the system uses in the forecast. The default value is the maximum possible value (60). If you limit the number of historical periods, the most recent values are used in the forecast.

" Promotion smoothing is used to smooth the consumption values resulting in a promotion period, so that the results of the promotion do not distort the forecast.

" The forecast and consumption values can also be changed separately in user exits.

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

Processing

Messages for the article

Article

Article List

Article

Requirements Planning: Assessing the Forecast

Results

" Once a complete forecast has been carried out, the results must be checked to ensure the forecast ran without errors. There are two ways of doing this:

• Check the results of the forecast using a list

You can use a print program to output a list of the articles involved in the forecast and use this list for checking purposes.

• Check the results of the forecast online

Errors or exceptions occurring during the complete forecast are logged in exception messages and assigned to a particular error class. The articles for which errors occurred during the forecast are flagged as such. You can look at and process these flagged articles online. It is possible to select only these articles by entering the relevant error class.

" The following are examples of exceptional situations: • No historical values exist

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I n t e r n a l U s e S A P P a r t n e r O n l y

© SAP AG IRT330 2-17  SAP AG 2001 Forecast-based planning Reorder point planning Time-phased planning Replenishment Time-phased planning Mo Tu WeTh Fr Sa Su Mo Tu WeTh Fr Sa Su Planning cycle Delivery cycle Order date RP

RP procedure procedure RPRP type type

VB: Manual reorder point planning VM: Automatic reorder point planning

...

20 10 30 40 50 60 70 80 T i m e C o n s u m p . S t o c k 8070 90 100 60 110120 T i m e RP:Replenishment planning

Requirements Planning: Methods and Features

" Six basic methods are used in requirements planning: 1. Reorder point planning

2. Forecast-based planning 3. Time-phased planning 4. Replenishment

5. Materials requirements planning (MRP)* 6. Master production scheduling (MPS)*

*MRP and MPS are not relevant for retailing and are therefore not the subject of this course.

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

Replenishment lead time

Stock Lot size

Reorder point Safety stock

Reorder point Delivery date

Time Minimum

safety stock

Requirements Planning: Reorder Point Planning

" In this requirements planning method, the available stock in the warehouse is compared with the reorder point. If the available warehouse stock is less than the reorder point, a procurement proposal is generated.

" The reorder point is calculated using a safety stock stock and the expected average article

consumption during the replenishment lead time. As a result, the safety stock, existing consumption values, and the replenishment lead time must be taken into consideration when the reorder point is defined.

" The purpose of the safety stock is to provide a buffer if consumption for the article is greater than expected, or if new deliveries of the article are delayed. As a result, existing consumption values and future requirements, and the reliability of the vendor to deliver on time must be taken into consideration when the safety stock is defined.

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I n t e r n a l U s e S A P P a r t n e r O n l y

© SAP AG IRT330 2-19  SAP AG 2001 Replenishment lead time Reorder point Safety stock Time Stock Replenishment lead time Service level (MAD) Requirement fluctuations Daily requirem. x Replenishment lead time Minimum safety stock

Requirements Planning: Safety Stock and Reorder

Point

" Even if a warehouse is able to deliver an article 100% of the time, an appropriate safety stock must be retained in the warehouse, with all the costs involved, because forecasts may still be incorrect. The safety stock is dependent on the service level, the replenishment lead time, and the quality of the forecast resulting from the mean absolute deviation (MAD).

" If automatic comparison is used, the reorder point is recalculated as well as the safety stock. This is defined as the sum of the safety stock and the forecast requirement within the replenishment lead time.

" When articles are removed from stock, the system checks the 'static availability', namely the stock available at that particular point in time, not taking account of future requirements. It compares the remaining stock against the reorder point. If the resulting stock is lower than the reorder point, the article is flagged for requirements planning. The next time a requirements planning run is carried out, a purchase requisition or planning order is automatically generated for the article.

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001 Replenishment lead time Stock Safety stock Planning/ reorder point Delivery date Time Mo Tu We Th Fr Mo Tu We Th Fr Lot size Coverage period Minimum Safety stock

Requirements Planning: Time-Phased Planning

" If a vendor always delivers an article on a particular day of the week, it makes sense to carry out requirements planning using the same cycle but on a different day to take account of the delivery period. You can do this using the time-phased method of requirements planning.

" For time-phased planning to be carried out for an article, the RP type for time-phased planning and the planning cycle must be entered in the article master record. The planning cycle is entered in the form of a planning calendar in the Planning cycle field. In addition, you must define a planned delivery time and Exact lot size as the planning lot size.

" Articles for which time-phased planning is used are assigned a planning date in the planning file. This date is reset when an article master record is created and subequently after each planning run. This date corresponds to the day on which requirements planning is to be carried out next for the article. It is calculated on the basis of the planning cycle entered in the article master record. " You therefore have a method in which requirements planning for an article is always carried out on

specific days defined by you. If, for example, you assign the same planning cycle for all articles supplied by a vendor, requirements planning for all of these articles will be carried out on the same

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

MO TU WE TH FR SA SO MO TU WE TH FR SA SO Order days Delivery dates

Planning calendar Planning calendar

002 Delivery days (We + Fr) 002 Delivery days (We + Fr)

Calculation: Calculation: Week days Week days Wednesday and Friday Planning calendar Planning calendar 003 Planning days (

003 Planning days (MoMo + Tu) + Tu) Calculation: Calculation: Week days Week days Monday and Tuesday

Purch. processing time 1 working day Planned delivery time 3 working days

Artikel

Requirements Planning: Time-Phased Planning

with Delivery Cycle

D D B B L L D D B B L

" For articles that have a fixed delivery date as well as a fixed order date, you can use a planning calendar to define a delivery cycle as well as a planning cycle.

" The planned delivery time is interpreted as the minimum delivery time. In other words, at least that many days pass between planning, ordering, and delivery.

If, in the example, you order the goods on Tuesdays, they can be delivered on Friday at the earliest.

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001 Planning calendar Planning calendar 002

002 DelivDeliv. . daysdays ( (WeWe + Fr) + Fr) Calculation Calculation:: Week days Week days Wednesday and Friday Planning cycle Delivery cycle Planning calendar Planning calendar 001

001 Planning days Planning days ( (MoMo)) Calculation

Calculation::

Weeks

Weeks ( (week daysweek days))

Monday

Start

Start of period of period Previous working day

Planning periods from 22.05. - 13.08.00 from to 22.05. 2000 28.05. 2000 29.05. 2000 04.06. 2000 05.06. 2000 05.06. 2000 11.06. 2000 *11.06. 2000 * 12.06. 2000 12.06. 2000 18.06. 200018.06. 2000 05.06. 2000 05.06. 2000 08.06. 200008.06. 2000 09.06. 2000 09.06. 2000 18.06. 200018.06. 2000 19.06. 2000 25.06. 2000 26.06. 2000 02.07. 2000 03.07. 2000 10.07. 2000 10.07. 2000 16.07. 2000 17.07. 2000 23.08. 2000 24.07. 2000 30.07. 2000 31.07. 2000 06.08. 2000 07.08. 2000 13.08. 2000 *

* Whit MondayWhit Monday

12.06.

12.06. 2000 2000

Article

Requirements Planning: Planning Calendar

" The planning and delivery cycles for an article are stored in separate planning calendars. " You should give the planning calendars names that reflect how they are used.

" Requirements Planning needs valid periods in the planning calendar, which means that you must have the periods in the planning calendar recalculated, particularly if changes have been made. The planning file entries are automatically updated when changes are made.

" The calculation rule is used to provide a greater level of detail in the planning calendar, for example whether weekly or monthly periods are involved, or which days of the week are used as the start of the periods.

" You can use the Period start date to define exceptional conditions for cases where the start date of the period is a public holiday.

" Separate planning calendars are created for each site. To keep the data entry work for the individual sites to a minimum, you are advised to create planning calendars at reference site level.

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I n t e r n a l U s e S A P P a r t n e r O n l y

: Stock has reached reorder point

Coverage period

Requirements Planning: Time-Phased Planning

with Reorder Point

" You can combine time-phased planning and reorder point planning. To do this, you enter the RP type for time-phased planning in the article master record and also create a reorder point. You can also have the system use a forecast to calculate a reorder point.

" In this case, requirements planning is not only carried out on the planning date entered in the planning file, but also when a goods issue results in the stock falling below the reorder point. If the stock falls below the reorder point, the system sets the planning indicator in the planning file, so that the article is included in the next planning run.

" When the stock falls below the reorder point, and extraordinary planning is carried out as a result, the requirement is calculated as follows: The system bases the calculation on a time interval starting at the time at which the stock fell below the reorder point, and ending on the date of the next regular planning run. The quantity ordered must satisfy the requirement of this period. Regular requirements planning is then carried out again on the next planning date.

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

Planning file entry Activity relevant

to Requirements Planning

Manual planning

file entry Planning_cycle

Purchase requisition Req. Planning Requirem. planning Purchasing

March

MO TU WE TH FR SA SO MO TU WE TH FR SA SO

Requirement = Ave. daily sales * (Cycle + Delivery time+ Processing time)+ Safety stock

6 days

Net requirem. calculat. Lot size calculation

Scheduling

Requirements Planning: Steps Involved (1/2)

" If automatic requirements planning is used for the article, and requirements planning is active in the site, planning file entries are created automatically each time an activity affecting requirements planning (such as goods issue, reservations, and so on) is carried out.

" Articles for which time-phased planning is used have an entry in the planning file because they have a planning cycle.

" Manual planning file entries can also be made at any time.

" Requirements planning can be carried out online or in the background.

" You can carry out specific planning for a single item or all items from a vendor, or complete planning for all articles that have a planning file entry.

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I n t e r n a l U s e S A P P a r t n e r O n l y

Req.. Planning Planning

Purchasing

Purchasing Purch. req. ...

Purchase requisitions

Complete planning

Complete planning,, site site R300R300

Planning

file

Partial planning

Partial planning,, site R300 site R300

Activity

relevant

relevant for for

Requirements Requirements Planning Planning March March MO TU WETH FR SA SOMO TU WETH FR SA SO

Requiremen t = Ave. daily sales * (Cycle + Delivery t ime+ P ro cessing time)+ Saf ety st ock

6 days Individual Individual articles articles Articles by Articles by vendor vendor Art: R100068 Vend.: R3001 VSR: Electr. MC: PC ... online background Dist. center Dist. center

Requirements Planning: Steps Involved (2/2)

" As a result of requirements planning, the system creates a worklist of purchase requisitions that were generated by a requirements planning run.

" The planning run can be carried out in two ways: • Complete planning

In this case, entries are read from a planning file and requirements are planned for the articles specified in this file. The entries in this planning file are created by events affecting planning (such as goods receipts or issues, changes in master data, and sales orders). They can also be created manually or as a result of the planning cycle defined for an article using time phases. Complete planning can be triggered online or scheduled in the background.

• Partial planning

In this case, requirements planning is carried out for an individual article, or a certain number of articles from a particular vendor (irrespective of the entries that exist in the planning file). In the latter case, you can select articles according to the vendor subrange (VSR), merchandise category (MC), purchasing goup, or stock planner, for example.

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

Requirements Planning:

Planning File Entry

R300 R300_R300 R100000 R100000_R100000 R100000 Listing/Requirements Planning Requirements planning x

Logistics view for DC RP type R1

Planning file entry

Low-level code

Articles Site NETCH NETPL ...

0005 R100000 R300 X X Planning-related change Planning-related change in planning horizon R300

" The planning file contains an entry for all of a site's planning-related articles as soon as requirements planning is activated for the site.

" The planning file controls the planning run and the scope of planning.

" If a planning-related change is made to the article (for example a purchase order), an entry is created in the planning file with a change indicator. If the planning-related change takes place within the planning horizon, a further change indicator is added (marked NETPL).

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I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

Articles

Requirements Planning: RP List and

Stock/Requirements List

Forecast Planning run Creation indicator or 1 2 RP list - Article/site - Stock planner/site - Product group/site - Vendor/site requirements list Current stock/ requirements list

Section according to: - Article/site - Stock planner/site - Product group/site - Vendor/site Restrictions: - Procurement type - RP type

- Article with indicator for requirements planning

Articles

" In a planning run, the system creates RP lists on the basis of creation indicators. These lists contain the results of requirements planning for the article concerned. The RP list always represents the future stock and requirements situation as at the last planning run and forms the basis for stock planner tasks. The RP list is stored in the system until it is either manually deleted or replaced by a new list created in the next planning run.

" The stock/requirements list reflects the current stock and requirement situation for an article. The main difference between this and the RP list is that the stock/requirements list contains the various planning elements. As a result, the stock/requirements list always shows the current availability of an article.

" The RP list reflects the results of the most recent planning run. Changes made between two planning runs are not taken into consideration in the RP list. In contrast, in the stock/requirements list, all current stock changes, receipts and issues are displayed. By comparing the RP list and the stock/requirements list, you can see the situation after the last planning run as compared to the current stock/requirements situation.

(39)

I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

Planning

Planning//forecast dataforecast data Forecast valuesForecast values Safety stock Basic value Logistics

Logistics: DC: DC RP type

Planned delivery time Lot size Stock planner Delivery cycle Autom. ordering Procurement type Supply source Site-spec. art. status Listing

Listing//reqreq.. planning planning

Article master Article master Site master Site master

?

Should requirem. planning be allowed

for site xyz?

?

How should article abc replenished in site xyz?

Requisition planning X

Dist. center

Dist. center ArticleArticle

Requirements Planning: Master Data

" The data that is important for consumption-based planning is stored at site level in the article master record.

" For requirements planning to be possible for a site, the 'Req. planning' field must be selected in the relevant master data.

" The planning method and parameters used to plan requirements of an article in a site are defined in various fields in the logistics view of the article for the site in question ('RP parameters', 'Forecast parameters', and 'Stock planner/data for procurement' subscreens).

(40)

I n t e r n a l U s e S A P P a r t n e r O n l y

Forecast values must/ can exist • Consumption indicator Take account of complete or unplanned consumption • RP indicator

Automatic calculation of safety stock and reorder point

Screen sequence

Consumption-based method: •Reorder point planning •Forecast-based planning •Time-phased planning Replenishment

Consumption-based method:

•Reorder point planning

•Forecast-based planning •Time-phased planning Replenishment Forecast MO TU WETH FR SA SO MO TU WETH FR SA SO Planning/delivery cycle Article Article

Requirements Planning: Control Options and

Features

" With the exception of replenishment, the planning methods listed above can take different forms depending on whether a forecast is used and other control parameters. These different forms are created as RP types and are assigned in the article master (logistics data).

" Both forecast-based and time-phased planning must use forecasts. With reorder point planning and replenishment, the use of forecast values is optional.

(41)

I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001 RP profile RP type Reorder point Safety stock ... Forecast parameters Forecast profile Period indicator Forecast model ... RP parameters RD01 R1 30 10 RP profile RD01:

Value Default only?

RP type R1 Reorder point 30 X Safety stock 10 ... Article Article

Requirements Planning: Planning/Forecast Profile

" To make it easier to maintain planning and forecast data, you can define planning and forecast profiles in SAP Retail and assign these to an article (in the logistics view/for a site).

" In the RP (planning) profile, you define:

• which fields are filled with values when planning data is entered in the article master record • which values these fields have

• which of these fields can be changed by the user

" The information stored in a profile is standard information that is needed in a similar form whenever article master records are maintained. The RP profile is therefore a data entry aid and facilitates management of planning data.

" When a profile is changed, the system not only updates the changed values in the profile, but also triggers a background job (RSPROFILE), which updates all article master records assigned to the profile that was changed. However, this only applies to changes relating to fixed values in the

(42)

I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

!

Explain the basic concepts of investment buying

and ensure the prerequisites exist for an

investment buying run.

!

Perform the following activities:

"

Make the settings for the investment buying

run

"

Simulate the investment buying run

At the conclusion of this topic, you will be able to:

Investment Buying: Topic Objectives

(43)

I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

Investment Buying: Purpose

!

Investment buying is a method of determining

procurement proposals that take account of future

price increases, and are to be covered by external

procurement.

!

The aim of investment buying is to purchase articles

" in suitable quantities

" in good time

" as cheaply as possible

(44)

I n t e r n a l U s e S A P P a r t n e r O n l y

© SAP AG IRT330 2-33  SAP AG 2001 Open PO quantities _Available stock ROI parameters Forecast Investment buying analysis Log Log Purch. req. Worklist Purch. order Purch. price conditions Purchase price higher than future price Actual ROI is lower than desired ROI Term inat . Term inat .

Calculate purch. quantity Select condition changes

Carry out purchase price simulation

Investment Buying: Overview

Calculate ROI

Select relevant articles (info record)

(45)

I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001 Purch. price

1

_Purch. price 15 Investment buying 2 weeks

Investment Buying: Steps (1/4)

" The following steps are involved in investment buying: • Automatic identification of future price changes • Calculation of the price difference

• Determination of the optimum (latest possible) order date

• Calculation of the optimum purchase order quantity based on a ROI calculation " Investment buying should be carried out in the following sequence:

• Regular deletion of old runs (MEI5) • Maintenance of price changes

- manual - PRICAT

(46)

I n t e r n a l U s e S A P P a r t n e r O n l y

1

_Purch. price 15 Current Current ROI ROI

2 weeks Price change Warehouse costs Operating costs Forecast values Expiration date/max. range of coverage Terms of payment Interest rate Investment buying

Investment Buying: Steps (2/4)

" Investment buying locates future changes to purchase price conditions and proposes that goods are purchased even if stocks are sufficient. The system compares warehouse and operating costs with the price savings. The decisive factor for a procurement proposal is the ROI (return on investment). " The ROI is calculated using the following formula:

100 * 52

ROI = (S - D*I*(W-T) - C*W - H) * ---

D * W

S = Price saving per base unit of measure D = Original price per base unit of measure I = Weekly interest rate

W = Recommended coverage period T = Payment required by (number of weeks) C = Storage costs per base unit of measure H = Warehousing costs

" Costs (interest, warehousing and storage costs) are subtracted from the price saving and the result is standarized on the basis of the original price and the basis of one year.

(47)

I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001 Purch. price

1

_Purch. price 15 Current

Current ROI ROI RequiredRequired ROI ROI 2 weeks Price change Warehouse costs Operating costs Forecast values Expiration date/

max. range of coverage Terms of payment Interest rate Site master (Purchasing/distribution) Investment buying Dist. center Dist. center

Investment Buying: Steps (3/4)

" A required minimum ROI can be defined at site level (site master data, Purchasing/Distribution view). This is then compared with the actual (current) ROI.

" In the calculation of the current ROI, iteration is carried out on the basis of the recommended coverage period (W). Iteration ends when the current ROI is less then the required ROI.

(48)

I n t e r n a l U s e S A P P a r t n e r O n l y

Current ROI ROI Purch. price

1

Price change Warehouse costs Operating costs Forecast values Expiration date/

max. range of coverage Terms of payment Interest rate Purch. price 15 Purch. order Vendor Purch. requisition ... work item Required

Required ROI ROI

2 weeks Site master (Purchasing/distribution) Investment buying Dist. center Dist. center

Investment Buying: Steps (4/4)

" When the current ROI is calculated, the recommended coverage period is changed until the value is lower than the required minimum ROI. The next-highest value is then used to calculate the

additional requirements and propose purchase order quantities. Example: Required (minimum) ROI from the site master: 30% Calculated ROI with coverage period = 1 week: 75%

2 weeks: 45%

3 weeks: 25%

The optimum coverage period is therefore 2 weeks in this case. The value 2 is now multipled by the average weekly value of the forecast and the resulting value is proposed for procurement.

" Purchase requisitions and purchase orders can be generated as follow-on documents in Investment Buying.

" You can create work items prior to the follow-on documents if you want. The work items are then processed and thereby converted to purchase requisitions or purchase orders. If you make the necessary settings for the workflow, you can have the system send the work items to the inboxes of the people responsible for processing them.

(49)

I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

•Terms of payment •Article volume •Storage cost indicator •Lot-size-independ. costs •Forecast values

•Total shelf life •Required ROI

•Location costs

•Storage cost percentage

Site Customizing

Maintain storage cost percentage and assign to a storage cost indicator •Storage loc. determ. •Storage costs for

RP lot size Vendor Vendor Distribution center Distribution center Article Article

(50)

I n t e r n a l U s e S A P P a r t n e r O n l y

• Maximum range of coverage • No. of days, log

• No. of days, price

PB00 ... C ont rol Parameters for IB Change-relevant condition types

Investment Buying: Control

(51)

I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

!

Describe the processes in Perishables Planning

in SAP Retail as a variation on Replenishment

!

List the options for the perishables planning list

!

Perform the following functions in the SAP Retail

system:

"

Trigger perishables planning and generate the

relevant follow-on documents

At the conclusion of this topic, you will be able to:

(52)

I n t e r n a l U s e S A P P a r t n e r O n l y

Fish and meat

Flowers Dairy Fruit and vegetables

Vendor 1 Vendor 1 Wholesaler Wholesaler Importer Importer

Perishables Planning: Use

" Perishables are a special group of articles that often have a short shelf life and are offered by several vendors each with a limited capacity for delivery (for example, produce). Consumers will usually only buy perishable products that look fresh. It is therefore important that the time between harvest and sale is as short as possible. Ideally, it should be no longer than 24 hours.

" However, the functions described in this topic are not restricted to perishable produce; you can also use them for any articles that are offered by several vendors simultaneously.

" The special functions and processes for planning, procuring and distributing perishables enables lean, optimized logistics. They allow you to analyze the current market situation quickly, support your decision-making processes, and enable you to order items quickly and easily.

(53)

I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

Procurement _Issue

Store

orders

(pull)

Quality? Price? Quantity?

Allocation

table

(

push

)

Purch

.

order

Collective

PO

Vendor Vendor Wholesaler Wholesaler Importer Importer Store 1 Store 1 Store 3 Store 3 Store 2 Store 2 Distribution center Distribution center

Perishables Planning: Procedure

" There are three versions of Perishables Planning:

• Purchase order: You can use this variant both centrally and locally in the stores to procure and distribute perishables. Because you can intervene manually, you have a high level of control over the whole process. You can use this transaction to forecast quantities, enter purchase prices, calculate sales prices and order perishable produce.

Once you have posted the data, the follow-on functions Store Order, Allocation Table, and Collective PO are available to you.

• Allocation table: This variant is intended for use in the head office (centralized planning). It makes use of the allocation table to distribute the purchase quantity of an article among the individual stores ('push' method).

• Collective PO: This variant is used in the head office for 'pull' operations. It determines the order quantities in the store orders (or more precisely store order follow-on documents) and uses this information to create collective purchase orders.

(54)

I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

Assortment list type: R

Procurement period: 01.03.- 02.03. Delivery date: 01.03.

POS sales period: 01.02.- 01.03.

Perishables Planning List

Article Vendor Order qty Net price ...

Apples Oranges Allfresh Allfresh Omnium 10 CR 20 CR 15 CAR 1.29 $ 1.43 $ 2.13 $ Assortment list Store or DC: R300 ... Collective PO Purch. order Alloc. table Processing method:

Perishables Planning List: Initial Screen

" The perishables planning list is based on the assortment list of the site for which requirements planning is being carried out. The articles must be listed in the site. From the perishables planning list, you can access further functions for procuring and distributing perishables. For example, you can change existing purchase orders.

" The allocation table and collective PO functions do not use the prices in the perishables planning list. Instead, they determine the prices separately. As a result, it is not possible to enter purchase prices in the perishables planning list if you use this processing method.

(55)

I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

POS sales period: 01.02.- 01.03.

Perishables Planning List

Article Vendor Order qty Net price Rem. qty ...

Apples Oranges Allfresh Allfresh Omnium 10 CR 20 CR 15 CAR 1.29 $/lb 1.43 $/lb 2.13 $/lb 61.69 kg 13.15 kg Sales Sales price 98 lb 46.72 kg 2.29 $/lb 2.49 $/lb Current stock + Vendor orders

- Store orders Sales / day

...

3.99 $/lb 26.76 kg 12.25 kg

Perishables PLanning List: Creation

" The system can calculate the remaining quantity per article to help you decide how much you need to order. The system uses a simple calculation rule to do this. You can use a user exit to replace this with a calculation model of your choice.

(56)

I n t e r n a l U s e S A P P a r t n e r O n l y

© SAP AG IRT330 2-45  SAP AG 2001 Simulation of the ordering transaction Change store orders and schedule lines Tele-buying (changing vendor prices) RP list for procuring from wholesale market Perishables planning list Info

Info system system Vendor masterVendor master

Article master Article master Pricing Pricing Purchasing Purchasing document document Issue list Issue list

Perishables Planning List: Functions and Access

to Other Functions

" You can use SAPPhone to create a phone link to the perishables seller or vendor directly from the perishables planning list so that you can negotiate purchase price conditions. (For more

information, see the SAP Retail documentation on tele-buying for fresh produce.) " You can create a special RP list for procurement from a wholesaler.

" You can simulate the posting transaction to test the system settings. A comprehensive error log is available here.

" There is a link to Pricing.

" In an interactive issue list, you can enter quantities and delivery dates for individual recipients or change the values defined by the system.

(57)

I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

Assortment list type Assortment list profile

Site: NY store Assortment list type: Perishables Valid from: 01.10.2000 Valid to: 31.10.2000 Article R100031 Description Granny Smith SUn kg From 01.10. Price 3.59

Maintain profile for assortment list > Assortment list

profile parameters

Assortment list structure WBBP_WDFR

Article

Article Store_Store

Distribution center

Perishables Planning: Assortment List

" Perishables functions use the perishables planning list. The perishables planning list is created by the system on the basis of an assortment list, which means that a current assortment list must exist for all stores concerned.

" The following requirements must also be met:

• The articles to be processed must all be assigned to the same article type (e.g. 'Perishables'). • The articles must be assigned to an assortment list (using the same assortment list type).

For the combination of assortment profile/assortment list type, assortment list structure WBBD_WDFR must be entered in Customizing.

• The articles must be listed in the site for which you are carrying out replenishment planning. • Master records must exist in the system for all the vendors involved.

(58)

I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001

!

Describe the basic concept of Replenishment in

SAP Retail

!

Understand replenishment functions and controls

as a separate method of planning requirements

At the conclusion of this topic, you will be able to:

Replenishment: Objectives

(59)

I n t e r n a l U s e S A P P a r t n e r O n l y

 SAP AG 2001 Sales figures Stock figures Replenishment Distribution center

Distribution center StoreStore

Replenishment: Relationships

Head office

Customer Customer Rep lenis_hm ent Sto_ck figu_res

" This set of functions was developed for replenishing stocks for stores and customers.

Replenishment for customers is inserted within the framework of VMI so that requirement planning can be carried out as a service.

" Replenishment planning for external customers can be used in both the SAP Retail system and the SAP Manufacturing system.

" Replenishment functions allow you to automatically create follow-on documents (purchase requisitions, purchase orders, sales orders and deliveries).

IRT330_46C_Col13_NW

I n t e r n a l U s e S A P P a r t n e r O n l y

I n t e r n a l U s e S A P P a r t n e r O n l y

Irt330 Requirements Planning and Buying

IRT 330

IRT 330

Requirements

Planning and

Buying

Requirements

Planning and

Buying

I n t e r n a l U s e S A P P a r t n e r O n l y

I n t e r n a l U s e S A P P a r t n e r O n l y

Copyright 2001 SAP AG. All rights reserved.

No part of this publication may be reproduced or transmitted in

any form or for any purpose without the express permission of

SAP AG. The information contained herein may be changed

without prior notice.

All rights reserved.

Copyright

I n t e r n a l U s e S A P P a r t n e r O n l y

I n t e r n a l U s e S A P P a r t n e r O n l y

SAP Retail

Level 2

Level 3

I n t e r n a l U s e S A P P a r t n e r O n l y

I n t e r n a l U s e S A P P a r t n e r O n l y

#

Basic knowledge of retailing

#

Required: IRT100 – Retail Process Overview

#

Recommended: IRT310 – Retail Master Data

Course Prerequisites

I n t e r n a l U s e S A P P a r t n e r O n l y

I n t e r n a l U s e S A P P a r t n e r O n l y

Target Group

#

Participants:

#

Duration: 3 days

I n t e r n a l U s e S A P P a r t n e r O n l y

I n t e r n a l U s e S A P P a r t n e r O n l y

!

Course Goal

!

Course Objectives

!

Course Content

!

Course Overview Diagram

!

Main Business Scenario

Contents:

Course Overview

I n t e r n a l U s e S A P P a r t n e r O n l y

I n t e r n a l U s e S A P P a r t n e r O n l y

This course will prepare you to:

Make the system settings required for all

purchasing activities in a SAP Retail system.

I n t e r n a l U s e S A P P a r t n e r O n l y

I n t e r n a l U s e S A P P a r t n e r O n l y

At the conclusion of this course, you will be able to:

Make the settings needed to carry out processes

relating to merchandise procurement as

effectively as possible.

Course Objectives

I n t e r n a l U s e S A P P a r t n e r O n l y

I n t e r n a l U s e S A P P a r t n e r O n l y

Unit 4

Subsequent

Settlement

Unit 5

Vendor Evaluation

Unit 6

Conclusion

Unit 1

Course Overview

Unit 2