Utilizing Forecasts in MRP

Forecasts in MRP can be used for planning Sales, Production, and Purchasing for a company. Sales Forecasts, also called sales budgets, are projections of achievable sales revenue. Projections are based on historical sales data, analysis of market surveys and trends, and salespersons' estimates. Forecasts are integral in the formation of business plans because the level of sales revenue affects practically every aspect of a business, including production estimates and scheduling. In DEACOM, sales forecasts are used to drive the MRP process. Active forecast sheets setup demand in the "(-M) forecast" demand bucket in time-phased MRP.

MRP can also be used to procure or produce the required quantities on time for internal purpose or for sales. With MRP at plant level, the system considers stocks from the storage locations within the plant, excluding the stocks already reserved. In case of MRP area level, the stocks from the storage locations belonging to this MRP area as defined can be taken for planning to generate the requirements. MRP area planning helps in cases where one wants to restrict the planning to certain storage locations. In DEACOM, users can enter a Purchase Order (PO) for required material directly from the MRP form.

Configuration

The configuration for Sales Orders, Purchase Orders, and Jobs should be completed prior to using MRP. Refer to Entering Sales Orders, Entering Purchase Orders, and Entering Production Jobs for full requirements.

Process

Forecasting Sales

DEACOM provides two tools to forecast sales: Forecasts for forecasts involving multiple items for multiple customers, and the Forecast Sales Order Type to represent independent demand for one customer.

Forecasts can be leveraged to:

  • Create sales forecasts based on historical sales of items in DEACOM.
  • Update existing sales forecasts by utilizing the percentage change tool and the pre-filter capabilities.
  • Compare forecast sheets to actual sales.

See the Creating and Modifying Forecasts page for process steps and examples.

Forecast Sales Orders would be used in a situation, for example, where actual customer orders do not arrive in time to account for Raw Material purchasing and production lead times. Forecast Sales Orders have the following characteristics:

  • Similar to normal Sales Order entry, but with an "Order Type" of Forecast.
  • Actual customers or a generic forecast customer may be used.
  • Forecast orders are not shipped, rather actual orders are entered normally then shipped.
  • Use "Due to Ship" date for time-phased bucketing or Instant date filtering.
  • Use actual Part Numbers or forecast families.
  • Greater of forecast or actual sales orders is used for the independent demand.

See the Creating and Modifying Forecast Sales Orders page for process steps and examples.

Forecasting Production

Production forecasts and requirements will be visible in MRP once sales forecasting information has been entered. DEACOM will display both direct production requirements (finished goods) and indirect requirements (raw materials and subassemblies) . The field and options on the "MRP" pre-filter allows users to specify the level of production information that will be displayed on MRP reports.

Forecasting Purchasing

To add a new Purchase Order via MRP, perform the following:

  1. Run MRP by navigating to Inventory > MRP and clicking "View".
  2. While in the MRP form, highlight the desired Part(s) and click "Expand".
  3. Double click the value in the "Part Info 2" column, which will change it to "Yes" for the selected Parts, then click the "Create PO" button.
  4. Select the appropriate Vendor and Facility.
    1. Note: The other header fields will be automatically populated after selecting a Vendor, but can be overridden by the user, if desired.
  5. Select the first order and click "Modify".
  6. On the Misc 1 tab, confirm that the "Ship-to" and "Search" fields are correct. If they are incorrect, change them for this order. These fields can be overwritten up until the order is received.
  7. On the Misc 2 tab, confirm the "AP account" is correct.
  8. Click "Modify" to call the Edit Purchase Order Line form then confirm the quantity and price shown for the part are correct. If no, make the necessary changes then save and exit. If yes, simply exit.
  9. Click the Dates tab and fill in the applicable date fields - "Due to dock" is the date that is used to drive MRP and must be filled in if using MRP.
  10. If adding more lines to the Purchase Order, click the "Next" button to save the first line and bring up a blank second line, or continuously click "Add" to add more lines.
  11. When finished adding lines to the Purchase Order, click the "Save" and "Exit" buttons, to exit from entering purchase order lines and return to the purchase order header.
  12. Review the Purchase Order by checking the total order amount. Similar to checking the extensions on the purchase order lines, a review of the total order amount can detect errors in order entry or inconsistent pricing. Click the "Save" button to save the order.

FAQ and Diagnostic Tips

How do I delete my old forecast?

Once a Forecast has been created, there is no way to completely delete it. Users can inactivate the Forecast so it only appears in the Inactive Forecast list.

How does DEACOM handle forecasts involving Phantom parts?

DEACOM redirects Forecasts for Phantom parts to the Phantom part's Bill of Materials instead. Specifically, when gathering Forecasts in MRP, if a part on a forecasts is a Phantom part, the system will add that part's BOM for the quantity forecast to the forecast line/column in the MRP report instead. For more information on Phantom Parts, refer to Using Kitted Parts.

Can I see modifications that have been made to an existing Forecast?

Yes, modifications to lines on a Forecast may be viewed via the "View Modifications" button on the DEACOM toolbar on the Forecasts form. Modifications to the header fields of an existing Forecast may be viewed by selecting the "dmforecast" table via System > User Modifications.