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YES, through the USE of forecasts INVENTORY levels can be set to MEET the demands while keeping levels as low as POSSIBLE.

Yes, through the use of forecasts inventory levels can be set to meet the demands while keeping levels as low as possible.

MRP is SHORT for Materials REQUIREMENTS Planning and it is a production planning technique that's used to manage the manufacturing process. It is basically used to determine your Material Planning PROCEDURE by specifying the various conditions like REORDER Point, Seasonal Requirement, Replenishment, Vendor MANAGED, Forecast Based and Master Production Scheduling (MPS). Lot size specifies the nature of material requirement in terms of Weekly, Monthly, Quantity and Maximum Replenishment.

MRP is short for Materials Requirements Planning and it is a production planning technique that's used to manage the manufacturing process. It is basically used to determine your Material Planning procedure by specifying the various conditions like Reorder Point, Seasonal Requirement, Replenishment, Vendor Managed, Forecast Based and Master Production Scheduling (MPS). Lot size specifies the nature of material requirement in terms of Weekly, Monthly, Quantity and Maximum Replenishment.

A ORDER POINT is a point in TIME at which a order is placed to replenish GOODS in INVENTORY.

A order point is a point in time at which a order is placed to replenish goods in inventory.

The GR blocked stock is an option used in the goods receipt process when you are not sure about the quality of the goods received. In such a CASE, the stock is maintained as GR blocked either from a MATERIAL viewpoint or exclusively for a purchase order ITEM.

The GR blocked stock is an option used in the goods receipt process when you are not sure about the quality of the goods received. In such a case, the stock is maintained as GR blocked either from a material viewpoint or exclusively for a purchase order item.

The various steps in consignment cycle are:

1. CREATE consignment info record with proper tax code.
2. Create Purchase order with item category K. 
3. Create output condition record for KONS (output type).
4. Authorize Goods RECEIPT (GR).
5. Payment is settled through MRKO transaction even if invoice VERIFICATION is not DONE.

The various steps in consignment cycle are:

The letters in the formulas represent the quantity ORDERED(Q), the CARRYING cost of a UNIT(C), the demand for the units(D) and the cost of completing a order(S).

The letters in the formulas represent the quantity ordered(Q), the carrying cost of a unit(C), the demand for the units(D) and the cost of completing a order(S).

Interference is a FACTOR in forecasting demand. Interference is made up of all the FACTORS that a FORECASTER has no control over. Factors that may be considered interference include natural disasters, UNUSUAL customer demands, or rare events in the BUSINESS period.

Interference is a factor in forecasting demand. Interference is made up of all the factors that a forecaster has no control over. Factors that may be considered interference include natural disasters, unusual customer demands, or rare events in the business period.

Contract is a long term outline agreement between vendor and ORDERING party over predefined material or services over certain FRAMEWORK of time WHEREAS scheduling agreement is a long term outline agreement between vendor and ordering party over a predefined material or SERVICE which are PROCURED on predetermined dates over a framework of time.

Contract is a long term outline agreement between vendor and ordering party over predefined material or services over certain framework of time whereas scheduling agreement is a long term outline agreement between vendor and ordering party over a predefined material or service which are procured on predetermined dates over a framework of time.

Special STOCKS are stocks that are MANAGED DIFFERENTLY as these stocks did not BELONG to company and these are being kept at some PARTICULAR location.

Special stocks are stocks that are managed differently as these stocks did not belong to company and these are being kept at some particular location.

Inventory control is the PROCESS of reducing inventory costs while remaining responsive to CUSTOMER demands. By this definition a STORE would want to lower its ACQUISITION, carrying ORDERING and stock-out costs to their lowest possible levels. However a store would need to have enough inventories to meet any needs of its customers.

Inventory control is the process of reducing inventory costs while remaining responsive to customer demands. By this definition a store would want to lower its acquisition, carrying ordering and stock-out costs to their lowest possible levels. However a store would need to have enough inventories to meet any needs of its customers.

Outline agreement is a long term purchasing agreement with vendor containing terms and CONDITIONS regarding the material that is supplied by vendor. Outline agreement are valid up to CERTAIN period of TIME and COVER a certain predefined quantity or value.

Outline agreement is a long term purchasing agreement with vendor containing terms and conditions regarding the material that is supplied by vendor. Outline agreement are valid up to certain period of time and cover a certain predefined quantity or value.

In planned SERVICES at the TIME of procurement specifications LIKE quantity and price are known in advance. It means NATURE and scope of service is clear before procurement whereas in unplanned services at the time of procurement specifications like quantity and price are not known in advance. It means nature and scope of service is not clear before procurement. These services can be EXTENDED as per the requirement.

In planned services at the time of procurement specifications like quantity and price are known in advance. It means nature and scope of service is clear before procurement whereas in unplanned services at the time of procurement specifications like quantity and price are not known in advance. It means nature and scope of service is not clear before procurement. These services can be extended as per the requirement.

One step TRANSFERS of MATERIALS can be posted USING movement type 301. Other movement types are 303, 351, 641, or 643 in the stock TRANSPORT order.

One step transfers of materials can be posted using movement type 301. Other movement types are 303, 351, 641, or 643 in the stock transport order.

There are several types of reordering systems, in this module we discussed three. The FIXED order quantity USES fixed quantities of goods ordered at various order points to replenish inventory. The fixed order period USE fixed times of reorder with various order quantities to replenish inventory to preset levels. The FINAL system, just in time uses a constant FLOW of goods to match the level of demand.

There are several types of reordering systems, in this module we discussed three. The fixed order quantity uses fixed quantities of goods ordered at various order points to replenish inventory. The fixed order period use fixed times of reorder with various order quantities to replenish inventory to preset levels. The final system, just in time uses a constant flow of goods to match the level of demand.

The EOQ level is the POINT at which STOCKING COSTS are at their lowest point for a given ITEM.

The EOQ level is the point at which stocking costs are at their lowest point for a given item.

Sometimes, stock need to be blocked in advance so that it can be available at a particular point of time. This is known as reservation. Reservation ensures that stock is available and it can be USED when REQUIRED. RESERVED quantity can be VIEWED by tcode MMBE.

Sometimes, stock need to be blocked in advance so that it can be available at a particular point of time. This is known as reservation. Reservation ensures that stock is available and it can be used when required. Reserved quantity can be viewed by tcode MMBE.

Once goods are procured from vendor and placed in COMPANY's premises through goods receipt then we need to PAY to vendor for acquired goods and services. The amount to be paid ALONG with details of material is provided by vendor in FORM of document that is known as invoice. Before paying to vendor we need to verify the invoice. This process of verifying invoice and paying to vendor is known as invoice VERIFICATION.

Once goods are procured from vendor and placed in company's premises through goods receipt then we need to pay to vendor for acquired goods and services. The amount to be paid along with details of material is provided by vendor in form of document that is known as invoice. Before paying to vendor we need to verify the invoice. This process of verifying invoice and paying to vendor is known as invoice verification.

EOQ STANDS for ECONOMIC ORDER QUANTITY.

EOQ stands for Economic Order Quantity.

The EOQ works if its four assumptions match the case it is used on. The assumptions are:

1. Annual demand, carrying costs and ordering costs can be estimated.
2. Inventory level is divided by 2, no safety STOCK, goods used uniformly and are gone by NEXT order.
3. Stock-out, customer responsiveness and other costs not considered.
4. No quantity DISCOUNTS.

The EOQ works if its four assumptions match the case it is used on. The assumptions are:

Source list INCLUDE list of possible SOURCES of SUPPLY for a MATERIAL over a given framework of time. A particular material can be ordered from different vendors in different time intervals. This information can be maintained in a source list.

Source list include list of possible sources of supply for a material over a given framework of time. A particular material can be ordered from different vendors in different time intervals. This information can be maintained in a source list.

The EOQ LEVEL is the POINT at which stocking costs are at their LOWEST point for a given ITEM.

The EOQ level is the point at which stocking costs are at their lowest point for a given item.

YES, In the market TODAY there are many computer software PACKAGES that can compute forecasted demand for GOODS held in inventory.

Yes, In the market today there are many computer software packages that can compute forecasted demand for goods held in inventory.

While a scheduling agreement is for consignment, SUBCONTRACTING and stock TRANSFER, a contract is for Standard items and can be limited to a certain quantity or value.

A contract can be CREATED centrally with different pricing conditions for every plant WHEREAS a scheduling agreement needs to be created at that particular plant LOCATION. In a contract, only time-dependant conditions can be created whereas in a scheduling agreement, you can have time-dependant or time-independent conditions subject to the customizations in the document type.

While a scheduling agreement is for consignment, subcontracting and stock transfer, a contract is for Standard items and can be limited to a certain quantity or value.

A contract can be created centrally with different pricing conditions for every plant whereas a scheduling agreement needs to be created at that particular plant location. In a contract, only time-dependant conditions can be created whereas in a scheduling agreement, you can have time-dependant or time-independent conditions subject to the customizations in the document type.

No, release is done only at header LEVEL in a COMBINED WAY for all line ITEMS in case of PURCHASE order.

No, release is done only at header level in a combined way for all line items in case of purchase order.

The steps involved in creating a PRICING PROCEDURE are:

1. Create condition tables. 
2. Create access sequence according to the various condition tables.
3. Create condition types. 
4. Assign access sequence to condition type.
5. Create the pricing procedure. 
6. List down all the condition types in order so as to SUIT the business and pricing REQUIREMENTS.

The steps involved in creating a pricing procedure are:

No, the MODEL only WORKS for those CASES that MEET its ASSUMPTIONS.

No, the model only works for those cases that meet its assumptions.

In Consignment, material is available at our store PREMISES, HOWEVER it still belongs to the VENDOR(seller)/Owner of the material. If you utilize the material from consignment STOCKS, then you have to pay to the vendor.

In Consignment, material is available at our store premises, however it still belongs to the vendor(seller)/Owner of the material. If you utilize the material from consignment stocks, then you have to pay to the vendor.

A INVENTORY should be taken at least once a YEAR. If items are perishable, SEASONAL or HIGHLY demanded a inventory should be taken more OFTEN.

A inventory should be taken at least once a year. If items are perishable, seasonal or highly demanded a inventory should be taken more often.

The EOQ formula is the square root of 2 TIMES demand times order COMPLETION cost divided by CARRYING cost. The mathematical formula is square root of 2DS/C.

The EOQ formula is the square root of 2 times demand times order completion cost divided by carrying cost. The mathematical formula is square root of 2DS/C.

Release procedure means APPROVAL of DOCUMENTS LIKE PURCHASE orders and purchase requisition MANUALLY by the criteria defined in the configuration.

Release procedure means approval of documents like purchase orders and purchase requisition manually by the criteria defined in the configuration.

Stock within PLANTS is transferred with the help of stock TRANSPORT order. One plant order the goods internally from ANOTHER plant(RECEIVING plant/issuing plant) with the help of stock transport order.

Stock within plants is transferred with the help of stock transport order. One plant order the goods internally from another plant(receiving plant/issuing plant) with the help of stock transport order.

YES, MATERIAL and VENDOR data is available at all levels as it is normally created for company and it is VALID for the levels below company.

Yes, material and vendor data is available at all levels as it is normally created for company and it is valid for the levels below company.

YES, a DISCOUNT will cause the basic EOQ model to FAIL. To use a discount in determine a EOQ you must use the EOQ model with quantity discounts.

Yes, a discount will cause the basic EOQ model to fail. To use a discount in determine a EOQ you must use the EOQ model with quantity discounts.

Special stocks available are CONSIGNMENT stocks (from VENDOR), subcontracting stocks (to sun-contractor), project stocks, PIPELINE materials, SALES order stocks, stock transfer and THIRD party.

Special stocks available are consignment stocks (from vendor), subcontracting stocks (to sun-contractor), project stocks, pipeline materials, sales order stocks, stock transfer and third party.

Materials with some COMMON attributes are GROUPED together and they are assigned to a material TYPE. This will differentiate materials and allow organization to manage different materials in systematic manner in ACCORDANCE to company's requirement.

Materials with some common attributes are grouped together and they are assigned to a material type. This will differentiate materials and allow organization to manage different materials in systematic manner in accordance to company's requirement.

By following your INVENTORY policy you should be ABLE to realize important advantages in inventory CONTROL. The first is reduced costs for INVENTORIES, along with reduced amounts of inventory. Theft and shrinkage should also be reduced if inventory policy is followed. The final benefit will be INCREASED profits for the store.

By following your inventory policy you should be able to realize important advantages in inventory control. The first is reduced costs for inventories, along with reduced amounts of inventory. Theft and shrinkage should also be reduced if inventory policy is followed. The final benefit will be increased profits for the store.

GOODS RECEIPT and goods issue will cause change in STOCK as goods receipt will INCREASE warehouse stock and goods issue will DECREASE warehouse stock.

Goods receipt and goods issue will cause change in stock as goods receipt will increase warehouse stock and goods issue will decrease warehouse stock.

Times for reordering goods vary dependent on the CONTROL system you use and its lead TIME. In fixed order quantities reorders should be placed when the safety stock is reached. In fixed period systems the reordering is DONE at set time periods. In just in time systems reordering is based on matching the demand with supply. For just in time a close watch on INVENTORY levels is NEEDED so that reorders are placed before goods are out of stock.

Times for reordering goods vary dependent on the control system you use and its lead time. In fixed order quantities reorders should be placed when the safety stock is reached. In fixed period systems the reordering is done at set time periods. In just in time systems reordering is based on matching the demand with supply. For just in time a close watch on inventory levels is needed so that reorders are placed before goods are out of stock.

RFQ is request for quotation and it is a form of invitation that is SENT to vendors to submit quotation indicating pricing and their TERMS and CONDITIONS while quotation is a reply by a VENDOR in response to request for quotation.

RFQ is request for quotation and it is a form of invitation that is sent to vendors to submit quotation indicating pricing and their terms and conditions while quotation is a reply by a vendor in response to request for quotation.

The purchasing view consists of RFQ / Quotation, Purchase Requisition (PR), Purchase Order (PO), Master DATA that has several fields like info RECORD, source list, conditions, VENDORS etc. and FINALLY OUTLINE Agreements.

The purchasing view consists of RFQ / Quotation, Purchase Requisition (PR), Purchase Order (PO), Master Data that has several fields like info record, source list, conditions, vendors etc. and finally Outline Agreements.

A good FORECAST model will have REASONABLE COSTS. the accuracy of its forecasts will allow good decision making. The model will have AMPLE data available for its use and a relevant time span. The model finally will have a LOW interference level.

A good forecast model will have reasonable costs. the accuracy of its forecasts will allow good decision making. The model will have ample data available for its use and a relevant time span. The model finally will have a low interference level.

A batch is a COLLECTION of similar items from your STOCK that have the same characteristics. For example, all food items produced on a particular day belong to one batch.

Batches are searched using the standard facility (match code, key F4) based on the batch NAMES or other properties that distinguish them from others.

A batch is a collection of similar items from your stock that have the same characteristics. For example, all food items produced on a particular day belong to one batch.

Batches are searched using the standard facility (match code, key F4) based on the batch names or other properties that distinguish them from others.

Forecasting is the process of ESTIMATING the FUTURE DEMAND of a PRODUCT.

Forecasting is the process of estimating the future demand of a product.

There are two types of forecasting qualitative and quantitative. Qualitative uses personal opinions to DETERMINE FORECASTS. Quantitative uses NUMERICAL DATA and statistical modeling to determine forecasts.

There are two types of forecasting qualitative and quantitative. Qualitative uses personal opinions to determine forecasts. Quantitative uses numerical data and statistical modeling to determine forecasts.

Demand is the QUANTITY that CUSTOMERS are WILLING to BUY. Demand can be found through forecasting and is needed to find the EOQ level.

Demand is the quantity that customers are willing to buy. Demand can be found through forecasting and is needed to find the EOQ level.

PROCUREMENT Process starts with gathering requirements, then creating a purchase REQUISITION and then we CREATE a formal document that has to be SENT to vendor i.e. purchase ORDER. After this goods will be supplied by vendor and goods receipt is done along with invoice verification. Then vendor is paid for supplied goods and services.

Procurement Process starts with gathering requirements, then creating a purchase requisition and then we create a formal document that has to be sent to vendor i.e. purchase order. After this goods will be supplied by vendor and goods receipt is done along with invoice verification. Then vendor is paid for supplied goods and services.

When CONDUCTING a PHYSICAL inventory the CLASSIFICATION, location and number in STOCK of a GOOD should be recorded.

When conducting a physical inventory the classification, location and number in stock of a good should be recorded.

An ORDER QUANTITY is the AMOUNT of goods that an order requests be shipped to the STORE.

An order quantity is the amount of goods that an order requests be shipped to the store.