Preallocation

Promotions and seasonal events, such as Christmas, can lead to an unusual uplift in customer demand. To meet this demand, you can use a preallocation profile to move merchandise deliveries to stores or distribution centers to an earlier timeframe than originally needed. This allows you to distribute the workload over more weeks and thus avoid logistical bottlenecks at peak demand times.

The Maintain Preallocation Profile screen contains a table where you can enter a source week, target week, and percentage to be preallocated to the target week. You then assign the profile to location product combinations using the Location Product Mass Maintenance transaction. The requirement calculation uses this information when determining forecasted quantities for each store.

Example Example

Suppose the original demand of a popular toy would be 40 pieces to be delivered to each store in week 51. However, you know that an exceptionally high delivery quantity for this week would cause a logistic bottleneck. In this case, you can shift a portion of the forecast demand to an earlier timeframe, so that stores will receive an additional 20 pieces in week 49 and an additional 10 pieces in week 50, leaving only 10 pieces for week 51.

The preallocation profile for this might look like the following:

Source Week	Target Week	Percentage
200751	200749	50%
200751	200750	25%

You enter a percentage of the total delivery, not the number of toys. Also, the weeks are expressed in yyyyww format. The system distributes the additional demand equally over all sales days within the target week.

End of the example.

Note Note

Only the forecasted demand is shifted from the source week to the target weeks for the purpose of demand calculation. However, the real demand will only occur in the source week. This means that the stock in the target week will be higher than the real demand, but the preallocated part of the stock cannot be sold prior to the source week. Therefore, the preallocated demand is virtually reserved during demand calculation for the source week

End of the note.

A single preallocation profile can contain multiple source weeks and multiple target weeks. It is also possible for one source week to have several target weeks. However, you cannot have a week that is both a source and target week in the same profile.

The target week must always be earlier than the source week; that is, you can only move deliveries to an earlier point in time, not later.

You can create, copy, and delete preallocation profiles.

Integration

The system checks whether the demand for a given week exceeds the hard or soft limits maintained in Customizing, such as:

Maximum quantity that can be ordered without exceeding the maximum stock
Maximum quantity that can be ordered without exceeding the shelf life duration
Maximum quantity that can be ordered without exceeding the maximum target range of coverage

Preallocated quantities can override soft limits for the first demand period only, but not the hard limits.

Example Example

Suppose the maximum stock limit for a product is 60 pieces and the net demand for the first demand period is 50 pieces. The preallocated demand would generate an order for 70 pieces.

If the maximum stock is a soft limit, the system generates a warning message but still orders the full 70 pieces.
If the maximum stock is a hard limit, then the system generates a warning and reduces the order to 60.

End of the example.

The replenishment planner must determine the preallocation percentages manually. There is no automatic determination based on sales volume.

Preallocation is only considered during replenishment calculation. Preallocated quantities are not visible in the SAP F&R user interface (for example, in the Replenishment Workbench).