What Is a Product Group? 

Definition

You plan product group data in standard SOP (for an explanation of standard SOP, see Basics of Sales & Operations Planning).

If you want to include product groups in a planning hierarchy, use level-by-level planning. Do not use the planning hierarchy function to create product group hierarchies; for this purpose, use the product group function. See also Planning Hierarchies Containing Product Groups.

A product group combines other product groups and materials according to whatever criteria best meet the needs of your enterprise; for example, manufacturing procedure, product design, or market niche.

Product groups are classified according to whether they are mutli-level or single-level.

A product group is multi-level if it contains other product groups. However, the lowest level in a product group hierarchy always consists of materials.

A product group is single-level if its members are materials only.

A material or product group can be a member of more than one owner product group.

 

Example of a Multi-Level Product Group