Replenishment uses Journals to calculate Purchase Order and Transfer Order proposals based on the current stock situation and the demand in the stores or in the warehouse.
The Journals calculation tries to fulfill the demand in the stores or warehouse and considers Transfer Multiples and Order Multiples to find the best quantity. The primary goal of the system is to avoid stock-out situations, and therefore it always proposes to purchase and/or transfer when demand exists - this could lead to small Transfer Orders or Purchase Orders and increased transportation and/or handling cost.
Threshold Rules is a tool to avoid those small Transfer Orders or Purchase Orders by setting lower limits for:
- Quantity
- Weight
- Cubage
- Cost Amount
- Sales Amount
- Profit Amount
Furthermore, it is possible to set upper limits for the above fields to incorporate business rules or contractual definitions with Vendors or Transportation companies. Those limits can be defined per Vendor, Store/Location, and Item hierarchy (Division, Item Category, Retail Product Group, Item).
Note: Threshold Rules are not applicable to the BOM Replenishment Journal as it does not calculate Purchase Order and Transfer Order proposals.
Actual Values
Threshold Management calculates and displays the Actual Values for:
- Quantity
- Weight
- Cubage
- Cost amount
- Sales amount
- Profit amount
in the Replenishment Journal Detail Lines and totals the values to Replenishment Journal Lines and the whole Replenishment Journal. See How to: Set Up Threshold Fields Visibility for more information on how to define which of the above fields should be displayed in the Journal.
Actual Value versus Threshold
If Thresholds are defined in the Threshold Rules page and are activated in the Replen. Setup page, those Thresholds are calculated during the Replenishment Journal calculation. The result of this calculation is stored in the Threshold Rule Values page and shows the upper and lower limit and the Actual Value as calculated in the Journal.
Exceptions
An Exception is raised, when the Actual Value for a Threshold Rule is outside the lower and upper Threshold limit. A field in the Replenishment Journal page shows the number of active Exceptions for the current Journal.
The creation of Purchase Orders and Transfer Orders from Replenishment Journals with existing Exceptions can be fully blocked if the Thresholds Block Doc. Creation check box is selected in the Replen. Setup page, or it can be partially blocked if the Thresholds Partial Doc. Create check box is selected in the same page. This applies to the Scheduler-based document creation and the Create Purchase Orders, Put Creation of Purchase Orders on Batch Posting Queue, Create Transfer Orders, or Put Creation of Transfer Orders on Batch Posting Queue actions on the Journal pages.
An existing Exception can be resolved in two ways:
- Adjusting the quantities in the Journal to increase or decrease the actual value until it meets the Thresholds.
- Accepting the Exception without adjusting the quantities.
When all Exceptions are resolved or accepted the Purchase Orders and/or Transfer Orders can be created from the Replenishment Journals.
Note: For more information about Thresholds Partial Document Create see the Document creation section in the Threshold Rules in Transfer and Purchase Journal help topic.
Tasks
The following table describes a sequence of tasks with links to the topics that describe them. These tasks are listed in the order in which they are generally performed.
| To | See |
|---|---|
| Set up the visibility of the Actual Value fields in the Transfer and Purchase Replenishment Journal. | How to: Set Up Threshold Fields Visibility |
| Set up Threshold Rules. | How to: Set Up Thresholds |
| Understand Threshold Rules in the Transfer and Purchase Replenishment Journal. | Threshold Rules in Transfer and Purchase Journal |
| Resolve Exceptions in the Transfer and Purchase Replenishment Journal. | How to: Resolve Exceptions in Transfer and Purchase Journal |