Forecast-based planning uses historical values and forecast values in the same way as reorder point planning does. Future requirements are determined using the integrated forecast program. However, in contrast to reorder point planning, these values then form the basis for requirements planning in forecast-based planning.

The forecast that calculates future requirements using historical data is executed at regular intervals. This procedure has the advantage that automatically determined requirements are continually modified to reflect current consumption requirements. If material has already been withdrawn from stock during the current period, the forecast requirement is reduced by the withdrawn quantity. Therefore the part of the forecast requirement that has already been consumed is not included in requirements planning (MRP run).

You can specify the period split for the forecast (daily, weekly, monthly, or by posting period) and the number of periods in the forecast for each material individually. However, it may be that the period split is not specific enough for planning purposes. Therefore, you can specify for each material whether the forecast requirements values in requirements planning are to be broken down in a more detailed period split. You can also specify how many forecast periods are to be taken into account during requirements planning.

In the case of monthly forecasting, the requirements date is defined as the first working day of the month. For planning purposes, it is assumed that the total requirement must be available at the start of the period. You can then divide these monthly requirements into daily or weekly requirements.

The requirements quantities that the system forecasts are used in requirements planning for performing the net requirements calculation. During this calculation, the system checks each period to ensure that the forecast requirements are covered by available warehouse stocks, planned receipts, or production. If the requirements that the system forecasts are not covered by the options listed above, the system generates an order proposal.

The system calculates the quantity in the order proposal according to the procedure selected for lot size calculation. Depending on the procedure used for lot size calculation, more than one requirements quantity is grouped in a single lot.

The system calculates the date on which each order proposal must be converted to a purchase order or a production order in order for the purchase order to be sent to the vendor or for the production order to be sent to production in time. The vending company can supply the ordered quantity on time only if it receives the purchase order in good time. The same applies to production: The ordered quantity can be produced on schedule only if the production order is submitted in good time.