Master planning - Reduction Principle

Hello,

In my forecast plan,

The sales forecast as 1/2/2011: 1000 pcs

There is an open sales order, request ship date 1/2/2011: 10 pcs

In master plan, the reduction principle as “Purchase/Sales orders”, Include forecast plan = check

I run forecast scheduling.

I run master scheduling.

But in planned order, AX suggests me to purchase 1010 pcs on 1/2/2011 (Sales forecast qty + Sales order qty). It seems like the reduction principle does not work.

Does anyone know why the reduction principle do not work?

sorry , i have also tried same scenario its not reducing,

may be its the way it is

I have changed some parameter setting and now its performing reduction principle

Hello,

I already set reduction principle in my master plan.

May I know which additional parameters control the reduction principle?

First look at the net requirements to ensure you are seeing the forecast and demand.

Then look at the item coverage what is teh principle, this will affect the suggestion along with the reduction with impact like fulfill minimum and coverage period.

Then look at the item coverage code, what are the principles here, how are your positive and negative days set for example.

You then have the reduction principle and forecast plan set on the master plan, which it sounds like you have set.

The forecast is reduced, but it is reduced in line with all the parameters set, it is not simply reduced carte blanche!

See coverage group> item coverage >and set reduction key >and its period, use wizard.

attatch this item coverage to item

it will work

Hello,

Thank you for your reply.

In fact, user requirement is very simple.

They have 1 year sales forecast in advance.

They want to place purchase order monthly. Minimum qty is zero (no need to keep stock on-hand).

In coverage group

Coverage code: Period

Coverage period: 30

Coverage time fence: 365

Positive days: 30

Forecast plan time fence: 365

Under this setting, I run forecast scheduling, then run master scheduling.

AX creates 1 planned order with 1010 pcs. (AX adds up sales forecast + actual sales order qty)

Then I try Hardik’s suggestion, create reduction key through wizard (select period unit as “month”), attach the key to coverage group.

Run forecast scheduling, run master scheduling, then AX deducts.

My questions:

  1. In order to make reduction principle “Purchase/Sales”, is it mandatory to set reduction key?

  2. “Reduction key” created by wizard, it create 12 records (each represent a month). What does the “percent” means? If I always want to deduct forecast from open sales order, should I set “100” for all month?

Sorry i really dont know ans for que. 1 but for

2) “Reduction key” created by wizard, it create 12 records (each represent a month). What does the “percent” means? If I always want to deduct forecast from open sales order, should I set “100” for all month?

when you will use reduction principle “percent” it will automaticaly deduct that amount of qty. if you already know that your forcast and will equal to your requirement or percentage than you should use this

for this you have to set period and percent on item forcast as well…

this what i know, i just tried this yesterday after your post so theory behind this i still need to find

if you are agree with my effort always verify solution

  1. Yes I believe this it the case

  2. You can reduce by a percent if your reduction principle is percent, not relevant to you.

I believe your positive days will potentially give you issues, and I would guess your negative is the same, but it depends upon the ordering pattern.

Hello,

Our ordering pattern is to purchase once per month – Group the demand within a month, then place a purchase order.

In fact, I am not sure the setup for positive day and negative day. I just try and compare the result.

For example:

sales qty 10 pcs, request ship date 01/Feb/2011

sale qty 20 pcs, request ship date 10/Feb/2011

At first, I set coverage period 30, positive day 0, and negative day 0. I believe this is correct setting, but master scheduling did not group my sales demand.

Then I set coverage period 30, positive day 30, and negative day 0. This time master scheduling groups my sales demad into 1 planned order.

So for our ordering pattern, does our coverage setting (coverage period 30, positive day 30, and negative day 0) correct?

I would say no it is not correct, but the positive and negative days only affect changes in dates and the replanning, it would not have affected the plan in the way you say I believe, unless of course you had other orders in the system. That said a 0 setting makes no sense whatsoever so I have never tested this because I would never need it. I believe your positive and negative days will give you issues eventually depending upon the demand and supply pattern and lead time fo the item.

What is your ‘coverage code’ in coverage group set up…?

positive and negative days have nothing to do with clubbing the requirement,

Positive days-For a particular item, there is inventory and a sales order is scheduled for delivery in 90 days. Should master scheduling generate a new planned purchase order to cover the requirement, or do you accept that the order is fulfilled from the current inventory?

If positive days are fewer than 90, a new planned purchase order is generated. If positive days are more than 90, no planned purchase order is generated. However, current inventory levels of the item are no longer available for new sales orders.

Negative days-For a particular item, a purchase order is scheduled for receipt on the 20th of the month, and a sales order is scheduled for delivery on the 19th of the same month. Should master scheduling generate a new planned purchase order to cover the requirement, or do you accept a late sales order delivery on the 20th?

If you set the negative days to zero, a new planned purchase order is generated. If you set the negative days to a number more than zero, no planned purchase order is generated. Instead, an action message is generated for the purchase order, and a futures message is generated for the sales order.

CHECK YOUR PARAMETERS AND ITEM REQUIREMENTS / STOCK CAREFULLY

I had trouble getting the reduction principal to work when set to ‘purchase/sales orders’ & I when I searched this site for info’ I was disappointed not to get the final word - it turns out that the reduction purchase/sales order principal must also be used with a reduction key in the coverage group.

For example, set up a reduction key with 12 monthly periods all set to 100% for each month, then Dynamics will reduce your the forecast by the amount of sales/purchase orders.

Regards,

Monty

Yes that is the case. Not sure why you were disappointed, if no one asks the question you are unlikely to get the answer [:D]

Hi Hardik,

I saw ur article about reduction key.can you please send me the parameter setup for reduction key.I am also facing the same problem.If u can send it will be gud.

awaiting for ur response.

Regards

NBSingh

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