Integration of Contract Packagers in the SPP Planning Processes 

Use

In Service Parts Planning (SPP) you can integrate contract packagers (CPs) in the planning processes.

Features

Inventory Planning

If you do not work with the total DRP lead time in inventory planning during the combined planning of the economic order quantity (EOQ) and safety stock (SFT), the system considers the CP during this planning when calculating the procurement lead time of products to the master location. You can specify whether you work with the total DRP lead time during the combined planning of the EOQ and SFT in Customizing for the service profile of EOQ and SFT calculation in the Use DRP PLT field.

For more information, see the Implementation Guide (IMG) for Advanced Planning and Optimization under Supply Chain Planning → Service Parts Planning (SPP) → Inventory Planning → Define Service Profile for EOQ/SFT Calculation.

Distribution Requirements Planning (DRP)

●      DRP generates a DRP matrix for products of a CP as it does for other location products. You can navigate to this DRP matrix from the master location DRP matrix by selecting a CP of the master location in the master location DRP matrix in the Contract Packager field.

●      If one or more active CPs are assigned to a master location, DRP aggregates the demands of the master location to the active CPs.

If there is a planning-related excess at the master location, the system creates substitution orders for the excess at the active CPs and reduces the projected stock to the minimum safety stock. Otherwise excess would remain unconsidered at the master location during planning of child locations with the Planned as Push deployment indicator since the system aggregates the demands of these child locations directly to the active CPs. In addition, there is no rounding to days’ supply at the master location and no rounding to pack sizes. For more information, see DRP Rounding Rules. For more information about the projected stock and the planned minimum safety stock, see DRP Matrix.

●      If an excess exists at an alternative CP, DRP creates a substitution order for this excess to the master location. Otherwise the system would not consider this excess during planning.

Antwerp is your active CP and Rotterdam is your alternative CP. If your supplier ships goods from the USA for the entry location Brussels to Rotterdam instead of to Antwerp, an excess has occurred at the alternative CP Rotterdam. In this case DRP creates a substitution order for this excess from Rotterdam to Brussels.

Deployment

Deployment from CP

Only push deployment is possible from a CP, pull deployment is not. For more information about push and pull deployment, see Deployment Modes.

●      If a master location has child locations with the Planned as Push deployment indicator, the CP can deliver directly to these child locations with push deployment, without going via the master location, meaning via the parent location of the affected child locations.

If Cologne is a child location of the master location Brussels and has the deployment indicator Planned as Push, your CP Antwerp does not have to deliver inbound goods to Brussels first. Instead it can send the proportion of the inbound goods that deployment has planned for Cologne directly from Antwerp to Cologne.

●      If a master location has child locations with the Planned as Pull indicator and these child locations have a current demand during the replenishment lead time, the CP can deliver these locations with push deployment directly. In this case the system uses the push procurement lead time from the SP to the child location when calculating demand in deployment.

●      If a master location has child locations with the Pull Only deployment indicator, the CP cannot deliver to these child locations directly. These child locations can only receive goods from their parent location since a pull deployment from the CP is not intended.

For more information, see Deployment and Push Deployment from/to Contract Packager.

Deployment to CP

During both push deployment and pull deployment, the child location to which the systems distributes the goods can be a CP. In this case, the system transfers the data from the DRP Matrix of the CP master location to the DRP Matrix of the CP as follows:

●      When the system transfers the data, it performs a backwards scheduling for the procurement time from the master location to the VDL.

●      The system overwrites the following key figure values of the DRP Matrix of the CP, with the key figure values from the DRP Matrix of the master location:

○       Location's Own Safety Stock

○       Proportion of Parent Safety Stock

○       Safety Stock

○       Planned Minimum Safety Stock Level

○       Minimum Net Demand

●      All other key figure values of the CP's DRP Matrix result from the sum of the original key figure values from the CP's DRP Matrix and the key figure values from the DRP Matrix of the master location.

When the system transfers the key figure values from the DRP Matrix of the master location, as described above, to the key figure values of the CP's DRP Matrix, the gross demands of the CP change (in particular because the safety stock of the master location is not considered in the gross demand of the CP). In this way, the time-related maximum storage quantity of the CP cannot be deduced directly from the DRP Matrix during Deployment to the CP.