Saturday, July 20, 2013

ATP inventory concepts | Order Management System!!

This blog does not give any coding example but folks working on WCS implementations, who work on Inventory and ATP and It is one of the most important concepts of an eCommerce site. Managing supply and demand and making sure the inventory is correctly updated on order placement is very important for running any business.

Important Inventory and ATP terminology and concepts: These are high level concepts and I am sure back-end systems such as SAP, Oracle, Sterling order management systems use these terms and each one of them could have slight variants.

  • Supply is all the inventory available.
  • Demand is all the orders placed and not yet fulfilled.--Reservations/Allocated Orders/Future expected demand.
  • Supply Type or Inventory buckets, this is gives a clear picture of Inventory availability and it could be moved between multiple buckets such (QA hold or Intransit or) . This is very important in calculating available inventory for consumption.
  • Demand Type is the group of quantities committed across various commitment channels.
  • Demand Supply Matching: This is also called available to sell calculation, Supply with a sufficient lifespan     along with demand.
  • Simple example of Available to Sell calculation
      • (Sum of All checked supply types) – (sum of all corresponding demand type)
      • Available To Sell = (Onhand + Intransit +  Qty in PO) – (Open Order + Reserved + Allocated)
  • Availability on hand, back order, preorder (Future Inventory).
  • Managing inventory at the plant level or distribution level.
  • Available-to-promise (ATP) enables to decide the availability of a item for current and future demand. (simplest version is supply-demand is ATP)
  • Based on threshold and Inventory availability -- Availability high\low\future inventory.
  • Inventory sourcing at the plant level or pool level.
  • Order fulfillment process, there are multiple demand types -Open/Reserved/Scheduled/Allocated.
  • ATP Monitor versus Inventory Monitor.
  • ATP Monitoring  modes:
    • Activity Based: Raises an event in real time every time an item goes      above or below one of the thresholds.
    • Quick Sync: Re-sends the most recently published inventory availability information.
    • Full Sync: Monitors all of the items regardless of activity and publishes the inventory information for all of the items.


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