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Product Allocations Introduction

Introduction

If demand for a product exceeds supply, the question arises as to who should receive what quantity of it. Release 3.0E of the standard R/3 System allows you to manage the allocation of such products to customers.

When a sales order is accepted, availability checks are carried out to find out whether the quantities ordered by the customer will be available on the desired date. If not, a counter delivery proposal is made to the customer. Where only limited availability checks are made, however, the first customer might order the entire available quantity of a scarce product, the result being that orders taken later from other customers cannot be confirmed at all or cannot be confirmed in time to satisfy customer demand. This problem can be avoided through period-dependent allocations.

The scarce product is not necessarily the article that is sold to the customer. It can also be just one component of the sold article.

Moreover, the type of allocation checks may change over time. For example, a customer may require an allocation for a special processor if he places a short-term order, but an allocation for the processor family as a whole may suffice for orders whose due dates lie further into the future. You can also create allocations for customers groups or regions, etc. rather than for individual customers.

Prerequisites

In the material master, the product allocation determination procedure has been added to the basic data screen for general data. Specifying a product allocation determination procedure is a precondition for checking availability against product allocation.
Planning of product allocations is carried out with Sales & Operations Planning (SOP) and is therefore based on an information structure.
In order to plan product allocations, you need to configure statistics updating of the information structure in Customizing for the Logistics Information System. This must be done at customer, material, header, and item level. In addition, you need to maintain the update group in Customizing for the Logistics Information System.
The individual steps you must carry out are:
a) Check and, if necessary, maintain the following settings.
Maintain statistics groups for customers
Maintain statistics groups for materials
Maintain statistics groups for sales documents
Assign statistics groups for each sales document type
Assign statistics groups for each sales document item type
Assign update group on item level
Assign update group on header level
b) Activate updating of standard information structure S140 or your own self-defined information structure.
Activate update
c) Check and, if necessary, maintain the update rules. In the standard information structure S140, the confirmed quantity of the line item is updated on the delivery date. The characteristics are updated by means of formulas.
Maintain update rules
d) Check the formulas of the characteristics.
Maintain formulas

Note

The described functionality is available in Release 3.0E. Please consult SAP if you wish to activate it.

Flexible Planning

Product allocation is based on the flexible planning functionality of SOP.

Planning is based on standard information structure S140 or a self-defined information structure. Information structure S140 contains the characteristics "product allocation object", "sales organization", "distribution channel", "customer group", and "sold-to party". Product allocation is currently not supported for more than one information structure in any one time period.
You create the planning hierarchy on the basis of information structure S140 or a self-defined information structure. If you decide to use a self-defined information structure, make sure it contains the characteristic "product allocation object" on the top level.
To represent your allocations, you can use the proportional factors predefined for the planning hierarchy. Alternatively, you can use the proportional factors that are dynamically calculated in the planning table.
The standard planning type "COMMIT" is supplied for use with standard information structure S140. You can create your own planning type for a self-defined information structure.
Always plan product allocations using planning version 000. This is because the key figure "incoming orders quantity" represents actual data that is updated from the SD system.
In the planning table, you plan your allocations. Use planning type "COMMIT" for information structure S140. Planning type "COMMIT" contains five key figures. In the planning table you use these as follows:
Here you enter the information that has been supplied by customers concerning the quantities they require.
You enter here, for each period, the total quantity that you want to commit to this customer or combination of customers.
This is the difference between customer requirements and the product allocation quantity. It is calculated by the system and cannot be overwritten.
This is the quantity confirmed at the delivery date for the line item. It represents actual data that is updated from the SD system and cannot be overwritten.
This is the difference between the product allocation quantity and the quantity already committed. It is calculated by the system and cannot be overwritten.

Availablity check against product allocation during order entry in SD

If the appropriate settings are made in Customizing (see requirement class and schedule line category) the system carries out an availability check against the ATP quantity during SD order quantity.

If the availability check shows that the ATP quantity fully or partially covers the order quantity, then a confirmed quantity is determined as a result of the availablity check. The confirmed quantity is the basis for the availability check against product allocation which is then carried out directly after the ATP check. If no check against the ATP quantity is carried out, then the check against product allocation is carried out with the order quantity.

Unlike in the ATP check, the check date for availability checking against product allocation is the planned delivery date with the customer and not the material availability date from delivery and transportation scheduling.

The result of the product allocation check can change the confirmed quantities that have already been determined.

A new entry has been made in the availability control screen in the Goto menu. Via Goto -> Product allocation you reach the display screen of the availability situation with regards to product allocation.

The same block mechanism is used for the availability check against product allocation as for the ATP check. The material block with transfer of requirements is only in force during the availability check against product allocation. In this way, several users can process the same material in different transactions at the same time without blocking each other.

Change system parameters in customizing

You need to maintain the following settings in Availability check against product allocation of Customizing for Sales & Distribution:

The product allocation determination procedure determines how product allocation is carried out. It is used in the following ways:
The assignments determine how product allocations can be created using the application menu.
The product allocation object is an object in the product allocation check.
An info structure is assigned to every product allocation determination procedure. The appropriate statistical structures can be determined and displayed automatically.
Product allocation determination procedures and product allocation objects are assigned to one another. Every combination is defined for a particular validity period.
Whether or not an availability check is to be carried out against product allocation is determined at requirements class level.
At the schedule line category level you can also control whether or not an availability check against product allocation is to be carried out. When controlling at schedule line category level, you must make sure that an option selected at requirements class level can be deactivated. The availability check cannot be deactivated at schedule line category level if it is not already deactivated at requirements class level.
This Customizing step allows you to maintain a collective allocation for characteristic values for which no specific allocation is defined. It does so by adding the characteristic value '#' to every level of the planning hierarchy except the top one. This top level is represented by the characteristic "product allocation object". Thus, it acts as a container for all characteristic values that are not specified by name in the planning hierarchy.
You quantify the allocations by defining proportional factors in the planning hierarchy.
When the system carries out allocations checking, it works from the bottom of the planning hierarchy upwards. With standard information structure S140, it checks whether an allocation has been maintained for the sold-to party for which the order has been taken. If not, it moves up one level and checks to see whether the customer belongs to a customer group for which an allocation has been maintained. If no allocation has been maintained for characteristic values at the lower levels, the system arrives at the sales organization level and derives the allocation from the proportional factor from the appropriate container (either a specific sales organization or the collective sales organization). If a valid combination of characteristic values is found but the allocation has already been used up, the container is not used.
Thus, you can account for the fact that only the most important customers have allocations without having to create separate master records for each of the characteristic values.
For every combination of product allocation determination procedure and product allocation object (defined in the Customizing step "controlling for product allocation" as described above) you can check whether the settings made are consistent.