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Suggested Purchase Order EssentialsLINDA SZYMANSKI
1. Productivity Gains
2. Multiple SPO or Order Methods
3. Supply Chain Optimization
4. Freight Optimization
5. Maximize Vendor Terms/Discounts
SUGGESTED PURCHASE ORDER
6. Future Cost Management
7. New Features
Vendor Order Review
Future On Order
• Future On Order• Accommodates Seasonal
Orders• Future On Order Listing
Future On Order
• Warning if requisition does not include future on order
Future On Order: Adjusted Details
• Adjustments made as a result of future on order
Future On Order: Materials Planning
• Flag Item Buy Plan with Expedite Window
FORECAST METHODS
Coverage Method: Weeks of Supply
• Weeks of Supply• Used for transfer orders
(Multi-Echelon)
• Single Coverage• Great flexibility in ordering• Provides variability in coverage
periods, delivery and percent of demand purchased
• Best used with:• Longer lead times – Single• Varying demand
Coverage Method: Coverage
• Recurring Coverage• Place multiple orders• Best used with:
• Stable, on going – Reccuring• Entire season
• Vendor forecasting
Coverage Method: Coverage
Coverage Method: Reorder Point
Coverage Method: Reorder Point
• Used for requisitions and transfer orders (Multi-Echelon)• Min/Max capability• Best used for products with
• Low volume demand or• Short reorder lead times
• Generate requisitions even when there is no future demand• Can be used in conjunction with other coverage methods for
seasonal product• Excel file upload
Coverage Method: Reorder Point
• Reorder Point - Types• Level - Generates requisition when on hand inventory falls below a
specified level (Trigger) and orders up to a specified quantity
• Amount - Generates requisition when on hand inventory falls below a specified level (Trigger) and orders a specific order amount
Trigger On Hand Type Qty SPO Amount
10 8 Level 25 17
Trigger On Hand Type Qty SPO Amount
10 8 Amount 25 25
Coverage Method: Economic Order Qty
• Economic Order Quantity (EOC)• Most cost effective quantity - algorithm of order vs. inventory costs
where cost is least• Best used for products where analysis of the order management cost
versus inventory cost is required• Used for requisitions and transfer orders (Multi -Echelon)
Coverage Method: Economic Order Qty
Economic Order Quantity• Item Ordering Cost –
Expense of purchasing the item
• Holding Cost – Cost to keep the item in stock
Coverage Method: Auto• Auto
• Algorithm based purchasing method based on inventory and purchasing costs• Parameter based setting• Most cost effective quantity when needed
• Parameter Driven• Truck Cubic Size• Container Cubic Size• Container Weight• Inventory Carrying Cost Percent• Inventory Dimensional Storage Cost• PO Processing Cost per Item • PO Processing Cost per PO
Coverage Method: Manual
• Manual• Similar to coverage plan in Materials Planning• Accommodates multiple lead times versus a single product or SKU
SUPPLY CHAIN OPTIMIZATION
Trailer / Container Volumes• Cube or weight based• Parameter driven • Drop and drag requisitions to combine and create trailer or
container loads
Vendor Maintenance - Vendor
Attributes cover significant vendor variation• Levels
• Order, Product, SKU• Metrics
• Currency, Units, Weight, Cube, Cases• Types
• Required, Preferred, Not Checked
Vendor Maintenance –Rules/Discounts
Vendor Maintenance –Rules/Discounts
HOTLISTS
Suggested Requisition Hotlist• Requisitions
and contents created via SPO
Transfer Hotlist• Listing of
Transfers to stores or warehouses
Expedite Hotlist• Orders which could be expedited• New Expedite Flag
Questions
