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  Calculating Days' Supply and Open Quantities

The system calculates days' supply and open quantities according to your settings in Customizing. Here, you can choose which demand the system uses as a basis for calculating days' supply and open quantities. You have the following options:

  • historical demand

  • future demand

  • both historical and future demand

For more information, see the Implementation Guide (IMG) for Advanced Planning and Optimization under Start of the navigation path Supply Chain Planning Next navigation step Service Parts Planning (SPP) Next navigation step Monitoring Next navigation step Shortage Analysis Next navigation step Make General Settings for Shortage Analysis End of the navigation path .

Note Note

The system does not calculate the days' supply in calendar days. Instead, it uses work days by considering the scaling factors you defined in Customizing.For more information about scaling factors, see the Implementation Guide (IMG) for Advanced Planning and Optimization by choosing Start of the navigation path Supply Chain Planning Next navigation step Service Parts Planning (SPP) Next navigation step Forecasting Next navigation step Make General Settings for Demand History End of the navigation path .

End of the note.

Note Note

The system only displays days' supply and open quantities for entry locations. That is, on bill of distribution (BOD) level but not on location level. The existing quantity corresponds to all available warehouse stock and stock in transit that is within the BOD that the system calculates days' supply and open quantities for.

End of the note.
Calculating Days' Supply and Open Quantities Based on Historical Demand

If you want to calculate days' supply and open quantities based on historical demand, you must have chosen the entry Only Historical Demand in the Calculation of Critical Products field in the general settings for shortage analysis. The system considers the number of days in the past that you have specified in the Days' Supply: Historical Demand (Days) as the historical time period.

To calculate the days' supply of the existing quantity of a product, the system proceeds as follows:

  1. The system adds the demands that occurred in the defined past time period. This historical demand corresponds to the demand that you see on the Adjust Demand History screen in the Demand: Final History key figure. You get to this screen on the SAP Easy Access screen by choosing Start of the navigation path Advanced Planning and Optimization Next navigation step Service Parts Planning (SPP) Next navigation step Environment Next navigation step Data Management End of the navigation path .

  2. The system determines the number of work days using the scaling factor defined in Customizing and the number of days specified by you in the Days' Supply: Historical Demand (Days) field.

  3. To determine the average demand per day, the system divides the sum of the demands (step 1) by the number of days (step 2).

  4. The system divides the existing quantity by the average demand per day and thereby determines the days' supply of the existing quantity.

    The existing quantity results as follows: initial warehouse stock + stock in transit – relevant open sales order in the past.

    You have specified which open sales orders the system considers to be relevant. You do this in Customizing for Advanced Planning and Optimization under Start of the navigation path Supply Chain Planning Next navigation step Service Parts Planning (SPP) Next navigation step Basic Settings Next navigation step Make Settings for Customer Demand End of the navigation path .

  5. This step is only relevant if you have set the Days' Supply Including Proc. Lead Time indicator in the general settings for shortage analysis. In this case, the system deducts the procurement lead time from the days' supply determined in step 4, and uses this value as the days' supply.

To calculate the open quantity, the system proceeds as follows:

  1. The system checks how many days the days' supply of the existing quantity of a product must be to not become critical or potentially critical. You can specify this in the general settings for the shortage analysis in the Time Units Potentially Critical from field.

    • If this value is less than the days' supply of a product, there is no open quantity.

    • If this value is greater than the days' supply of a product, the system continues with step 6 to determine the open quantity.

  2. The system subtracts the days' supply that was determined in step 4 from the value in the Time Unit Potentially Critical from field.

  3. This step is only relevant if you have set the Days' Supply Including Proc. Lead Time indicator in the general settings for shortage analysis. In this case, the system adds the procurement lead time to the value determined in step 7.

  4. The system multiplies the average demand per day (as determined above) by the value determined in step 6 (or if you have set the Days' Supply Including Proc. Lead Time indicator, the value determined in step 8). This gives the open quantity of the product.

    Example Example

    You have specified the time period for the historical demand as 30 in the Days' Supply: Historical Demand (Days) field.

    You have specified the value 5 as the scaling factor for weeks.

    In the Time Units Potentially Critical from field, you have entered the value 10 .

    As shown in the following diagram, the existing quantity amounts to 20 pieces.

    You have not set the Days' Supply Including Proc. Lead Time indicator.

    The final historical demand for the last 30 days amounts to a total of 85 pieces (20 + 15+ 25 + 15 + (2/7 *25) = 85).

    Thus the system calculates a days' supply of 5 daysin the following way:

    30 days * 5/7 = 21.4 days

    85 pieces / 21.4 days = 4 pieces per day

    20 pieces / 4 pieces per day = 5 days

    Based on this days' supply of 5 days, the system calculates an open quantity of 20 piecesin the following way:

    10 days > 5 days

    10 days – 5 days = 5 days

    5 days * 4 pieces per day = 20 pieces

    End of the example.
Calculating Days' Supply and Open Quantities Based on Future Demand

If you want to calculate days' supply and open quantities based on future demand, you must have chosen the entry Only Planned Demand in the Calculation of Critical Products field in the general settings for shortage analysis. In this case, you can decide whether the system uses the planned demand (that is, the receipts that are planned for the future) from Distribution Requirements Planning (DRP) or the demand forecasted by the forecast service, for determining the days' supply and open quantity for this demand.

  • If you want to use the demand planned by DRP as the future demand, you must have chosen the entry DRP Result (Scheduling Agreements and Purchase Requisitions) in the Type of Planned Demand field.

  • If you want to use the forecasted demand as the future demand, you must have chosen the entry Forecast (Current and Next Planning Periods) in the Type of Planned Demand field.

Considering Demand Planned by DRP as Future Demand

  1. DRP determines the planned demand for each day (this results from scheduling agreement releases and purchase requisitions).

  2. To determine the days' supply, DRP checks how long the existing quantity will be able to cover the planned demand.

  3. This step is only relevant if you have set the Days' Supply Including Proc. Lead Time indicator in the general settings for shortage analysis. In this case, the system deducts the procurement lead time from the days' supply determined in step 2, and uses this value as the days' supply.

To calculate the open quantity, the system proceeds as follows:

  1. The system checks how many days the days' supply of the existing quantity of a product must be to not become critical or potentially critical. You can specify this in the general settings for the shortage analysis in the Time Units Potentially Critical from field.

    • If this value is less than the days' supply of a product, there is no open quantity.

    • If this value is greater than the days' supply of a product, the system continues with step 5 to determine the open quantity.

  2. The system determines the planned demand across the number of days that you specified in the Days' Supply: Planned Demand (Days) field.

    If you have set the Days' Supply Including Proc. Lead Time indicator in the general settings for shortage analysis, the system adds the procurement lead time to the value in the Days' Supply of Planned Demand field and determines the planned demand across this number of days.

  3. The system subtracts the existing quantity from the planned demand (determined in step 5) and thus gets the open quantity of the product.

    Example Example

    In the Days' Supply: Planned Demand (Days) field, you have entered the value 10 .

    In the Time Units Potentially Critical from field, you have entered the value 30 .

    As shown in the following diagram, the existing quantity amounts to 20 pieces.

    You have not set the Days' Supply Including Proc. Lead Time indicator.

    This existing quantity is able to cover the demand of the next 6 days; so the system determines a day's supply of 6 days .

    Based on this days' supply of 6 days, the system calculates an open quantity of 24 piecesin the following way:

    10 days > 6 days

    In the next 10 days, the planned demand is 44 pieces.

    44 pieces - 20 pieces = 24 pieces

    End of the example.
Consider Forecasted Demand as Future Demand

  1. The system adds the forecasted demands of the current and next periods.This forecasted demand corresponds to the demand that you see on the Interactive Forecasting screen in the Demand: Final Forecast key figure. You get to this screen on the SAP Easy Access screen by choosing Start of the navigation path Advanced Planning and Optimization Next navigation step Service Parts Planning (SPP) Next navigation step Planning Next navigation step Forecasting End of the navigation path .

  2. The system scales this demand and determines the average demand per day.

  3. To determine the days' supply and the open quantity, the system proceeds as described in steps 4 to 9 of the above section Calculate Days' Supply and Open Quantities Based on Historical Demand .

    Example Example

    You have chosen Month as the forecast periodicity.

    You have specified the value 21 as the scaling factor for months.

    In the Time Units Potentially Critical from field, you have entered the value 10 .

    As shown in the following diagram, the existing quantity amounts to 20 pieces.

    You have not set the Days' Supply Including Proc. Lead Time indicator.

    The forecasted demand for the current period is 220 pieces; the forecasted demand for the next period is 200 pieces.

    Thus the system calculates a days' supply of 2 daysin the following way:

    220 pieces + 200 pieces = 420 pieces

    420 pieces / (21 days *2)= 10 pieces per day

    20 pieces / 10 pieces = 2

    Based on this days' supply of 2 days, the system calculates an open quantity of 80 piecesin the following way:

    10 days > 2 days

    10 days – 2 days = 8 days

    10 pieces per day * 8 days = 80 pieces

    End of the example.
Calculating Days' Supply and Open Quantities Based on Historical and Future Demand

If you want to calculate days' supply and open quantities based on historical demand and future demand, you must have chosen the entry Planned and Historical Demand in the Calculation of Critical Products field in the general settings for shortage analysis. The system considers the number of days in the past that you have specified in the Days' Supply: Historical Demand (Days) as the historical time period. The system considers either the forecasted demand or the demand planned by DRP as the future demand, depending on the entry you have chosen in the Type of Planned Demand field.

To calculate the days' supply open quantities, the system proceeds as follows:

  1. The system calculates the days' supply on the basis of the historical demand as described above.

  2. Depending on you settings in the Type of Planned Demand field, the system calculates the days' supply either on the basis of the demand planned by DRP or on the basis of the forecasted demand as described above in the corresponding section.

  3. The system compares the values calculated in steps 1 and 2.

  4. The system uses the smaller of the two values as the days' supply and calculates the open quantity for this days' supply as described above in the corresponding section.

    Example Example

    The days' supply based on the historical demand is 5 days.

    In the Type of Planned Demand field, you have chosen the entry DRP Result (Scheduling Agreements and Purchase Requisitions).

    The days' supply based on the demand planned by DRP is 6 days.

    Since the days' supply that the system calculated based on the historical demand is less than the days' supply that it calculated based on the demand that was planned by DRP, the system chooses 5 days as the days' supply. The corresponding open quantity amounts to 25 pieces( for the calculation, see the above section Calculation ofDays' Supply and Open Quantities Based on Historical Demand )

    End of the example.

    Example Example

    The days' supply based on the historical demand is 5 days.

    In the Type of Planned Demand field, you have chosen the entry Forecast (Current and Next Planning Periods).

    The days' supply based on the forecasted demand is 2 days.

    Since the days' supply that the system calculated based on the forecasted demand is less than the days' supply that was calculated based on the historical demand, the system chooses 2 days as the days' supply. The corresponding open quantity is 80 pieces(for the calculation, see the above section Consider Forecasted Demand as Future Demand ).

    End of the example.