Actions

P203

Calculate Sourcing Plan

The activities associated with determining a sourcing plan based on available demand and on-hand inventory, supplier scheduled deliveries and supplier contracts. This supply-demand balancing process will identify incremental supplier deliveries, excess inventory, undesired scheduled deliveries, excess contractual volumes and contractual shortages.

This process is generally highly automated and consists of two steps:

  • Netting: Determine the incremental needs by deducting the inventory and current commitmwns from the demand
  • Offsetting: Determine the timing of the incremental needs. This may include making recommendations to reschedule existing commitments

Alternative names include: Netting and Offsetting, MRP (Materials Requirements Planning), DRP Distribution Requirements Planning), Strategic Sourcing Plan (long term) Planning Frequency Cost Of Goods Sold Direct Material Costs

Hierarchy

IDNameLevelx
P2Plan Source2P2
P203Calculate Sourcing Plan3P203

Metric(s)

IDNameLevelx
RS11Planning Frequency2RS11
CO11Cost of Goods Sold2CO11
CO111Direct Material Costs3CO111

Term(s)

IDNameClearx
DRPDistribution Requirements PlanningDRP
MRPMaterial Requirements PlanningMRP

Workflow

FromInput(s)
Process
Output(s)To
wf_processwf_arrow
P201Gross Material Requirements
P202On-hand Inventory
P202Scheduled Receipts
P203
wf_arrowwf_process
Net Material RequirementsP204
Calculate Sourcing Plan Plan Source 120300 3 Material, Acquisition, Planning, MRP, Calculate, Requirements, Supply chain, Supply, Procurement, Purchasing, Netting, Offsetting Calculating the sourcing plan by comparing demand and supply for materials (and services)