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Planned Order Quantity calculation with Fixed Days Supply, daily buckets

in Supply Chain Planning and Collaboration 3 comments

How exactly is planned order quantity calculated when there is safety stock and fixed days supply? We were using below formula for checking the calculation but it seems like it's not correct all the time. Can anyone confirm?

Plan type = Constrained Demand Plan

Bucket Type = Daily buckets

• Net Demand = Total Demand – Scheduled Receipts

• Average Daily Demand = Net Demand ÷ Number of Working Days

• Total Inventory Requirement = Net Demand + Safety stock – PAB from previous bucket

• Number of additional supplies required = RoundDown [Total Inventory Requirement ÷ (Average Daily Demand x FDS)]

• Planned Order Quantity = Average Daily Demand x FDS

If [Total Inventory Requirement – (Number of Supplies with Respect to FDS x Planned Order Quantity)] = R > 0, then planning creates another planned order with quantity of 'R' to satisfy the inventory requirement without creating excess. This planned order does not respect FDS order modifier.

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