> > >

Select an item and then click . Select to open the form.

Use this form to calculate a minimum inventory level for the selected item in the journal. You can make the calculation two ways:

Both methods have the following prerequisites:

  • The issue quantity corresponds to the demand quantity.

  • The monthly demand can be described by a typical distribution.

Tasks that use this form

Navigating the form

The following links and table provide descriptions for the controls in this form.

Enter criteria on the General tab

Prepare batch processing on the Batch tab

Fields

Fields

Description

Select to calculate the minimum inventory level to cover the average number of issues that can occur during total lead time. The total lead time is the lead time on the item plus the that you specify.

Use this field to manage fluctuations in the number of issues. These might occur because of changing seasonal demand, for example. Enter a factor to multiply by the average number of issues during total lead time.

Select to calculate the minimum inventory level required to cover the standard variation of issues during the total lead time plus the service level percentage that you want to maintain.

Details of the calculation follow:

Minimum inventory level = safety factor*standard deviation per month*square root (total lead time / 30 days)

The following table shows the relationship between the service level and the safety factor:

[%]

Safety factor

50

0

80

0.84

90

1.28

95

1.65

98

2.05

99.86

3.00

99.99

4.00
Note Note

A service level of 50 percent will create a minimum inventory quantity of 0.

Select the service level that you want. This is defined as the percentage of time during which there is no stock out.

Enter the number of days for the lead time margin. These could be days used for internal administration of the order process, for example. This number of days is added to the lead time, and average issues are calculated for the period.

Select the check box to transfer the calculated minimum quantity to the field.

See Also