I have question regarding Planning Method B and On Hand quantities.
We use planning method B for inventory management on higher volume items. When a customer order line is entered using “Invent Order” as the Supply Code, the parts from stock are reserved. This makes the On Hand Qty remain the same (until shipping the stock, if I understand correctly) and the Availably Qty drop.
The issue I have is the Order Proposal is triggered by the On Hand Qty falling below the Order Point, rather than the Available Qty. So if I have 6 months lead time, by the time the On Hand Qty drops below the Order Point, I might already be too late to purchase more stock to avoid back order.
Could perhaps someone explain the replenishment process behind Planning Method B and why it uses On Hand Qty instead of Available Qty?
Best answer by ShawnBerkView original