Store Safety Stock specific to customer so that no other customer can steal the inventory.
Strategy
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Description
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Pros
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Cons
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Rescheduling
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Execute rescheduling daily to confirm quantities only for these materials so that LIDS orders are confirmed inventory first. This requires LIDS to have highest delivery priority. The strategy still requires careful demand planning and safety stock calculation.
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Fully automated and assures all available stock will go to LIDS first
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Order Confirmations cannot go out till rescheduling is completed.
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Manual Stock Reallocation
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Controls can be put in place at order confirmation and ARUN to make sure selective materials inventory levels are controlled. This involves manual steps to make a decision as to who the inventory should go to. The strategy still requires careful demand planning and safety stock calculation.
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Meets primary objective of assigning stock to LIDS first
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Manual process requiring effort (cost) and subject to error
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Stock confirmation via User Exit
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Enhance ATP functionality using standard BADI to influence ATP results.
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Meets primary objective of assigning stock to LIDS first
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Buries business rules in custom code.
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Consignment Processing
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Set up Consignment Process - Stock is kept at the customer premises or at a reserved location - as the inventory is consumed, the customer is invoiced. The strategy still requires careful demand planning and safety stock calculation.
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Segregates stock for LIDS and provides greater visibility and control to LIDS order fulfillment
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Manual process to allocate excess stock to LIDS /non-LIDS customers in case of demand mis-match
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Unique LIDS Safety Stock SLOC
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Create a SLOC to hold LIDS safety stock in blocked status. If any LIDS orders fail due to inadequate unrestricted stock, stock can be assigned from here if available.
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Allows planning and allocation for LIDS separately
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1. Requires manual (or user exit) steps to release stock from blocked SLOC.
2. Separate Independent demand and production required
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Min-Max Replenishment
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Consider min-max strategy for replenishment. Whenever stock goes below a certain minimum, replenishment orders are generated. No demand planning used.
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Assures automatic replenishment
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Strategy is not forward (demand) facing and generally rejected by current inventory strategists
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Dynamic Safety Stock
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Consider dynamic safety stock to arrive at the number. This automates safety stock calculation by reacting quickly to demand volatility - thus reducing chances of stock outs or over production.
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Lesser chances of stock outs; no need to calculate static safety stock
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Does not guarantee all available stock will go to LIDS first; may not be AFS compliant (checking)
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