Master Your Supply and Demand With Business Central Planning

The planning system in Business Central helps businesses balance supply and demand efficiently. It does this by:

• Collecting all demand and supply data (e.g., sales orders, inventory levels, purchase orders).
• Netting the results to determine shortages or surpluses.
• Creating suggestions for actions like:
  • Purchasing items.
  • Transferring inventory.
  • Producing goods.
  • Postponing or cancelling orders.

These suggestions aim to ensure that supply meets demand at the right time and in the right quantity.

Supply and demand

Planning Overview

Planning in Business Central revolves around balancing two key elements:

🔹 Demand

Represents any gross requirement, such as:

• Sales or service orders
• Component needs for assembly or production
• Outbound transfers
• Blanket orders or forecasts
• Technical demands like:
  • Negative production/purchase orders
  • Negative inventory
  • Purchase returns

🔹 Supply

Refers to any replenishment source, including:

• Inventory on hand
• Purchase, assembly, or production orders
• Inbound transfers
• Technical supply like:
  • Negative sales/service orders
  • Negative component needs
  • Sales returns

Planning Goals

• Match supply to demand accurately and timely.
• Avoid excess inventory by:
  • Postponing
  • Reducing quantity
  • Cancelling unnecessary replenishment orders when demand drops.

Planning calculation

The planning system uses a combination of:

• Customer demand (anticipated and actual)
• Inventory reordering parameters

to generate Action Messages—suggestions for:

• Replenishment from vendors
• Transfers between warehouses
• Production orders

If existing replenishment orders are already in place, the system may suggest:

• Increasing quantities
• Expediting delivery dates to meet updated demand.

Gross-to-Net Calculation

At the core of the planning routine is the gross-to-net calculation, which:

• Determines net requirements by subtracting supply from demand.
• Drives planned order releases:
  • Manufactured items: Scheduled using routing information.
  • Purchased items: Scheduled using lead time from the item card.

The quantity and timing of planned orders are influenced by:

• Planning parameters set on each item card (e.g., reorder point, lot size, safety stock).

Planning with manual transfer orders

Manual Transfer Orders in Planning

Business Central allows inventory movement between locations using transfer orders, which can be:

Automatically Created

• Based on SKU card settings in the Replenishment System field.
• The planning system generates transfer orders to balance supply and demand across locations.

Manually Created

• Used when you need to move inventory regardless of demand.
• You can manually create a transfer order for any quantity.

Controlling Planning Behaviour

To manage how the planning system interacts with manual transfer orders:

• Set Planning Flexibility to None

→ Prevents the planning system from modifying the transfer order.

• Set Planning Flexibility to Unlimited

→ Allows the planning system to adjust quantities and dates based on demand.

Planning parameters

Item/SKU-Level Planning Parameters

These control when, how much, and how to replenish inventory:

Timing Parameters

• Dampener Period: Prevents frequent changes by ignoring minor timing shifts.
• Time Bucket: Groups demand/supply into time intervals.
• Lot Accumulation Period: Combines multiple demands into one replenishment.
• Rescheduling Period: Defines how far out orders can be rescheduled.
• Safety Lead Time: Adds buffer days to expected delivery.

Quantity Parameters

• Dampener Quantity: Ignores small quantity changes.
• Reorder Point: Minimum stock before replenishment is triggered.
• Maximum Inventory: Upper limit for stock levels.
• Overflow Level: Triggers replenishment when stock exceeds this level.
• Reorder Quantity: Fixed quantity to reorder.
• Safety Stock Quantity: Minimum buffer stock to maintain.

Policy Parameters

• Reordering Policy: Defines how replenishment is calculated (e.g., Fixed Order Quantity, Lot-for-Lot).
• Assembly Policy: Controls how assemblies are planned.
• Manufacturing Policy: Determines production planning behavior.

Order Modifiers

These refine how orders are created:

• Minimum Order Quantity
• Maximum Order Quantity
• Order Multiple (rounds orders to a multiple of a set quantity)

Global Planning Setup Fields

Inventory Setup

• Current Demand Forecast
• Use Forecast on Locations
• Use Forecast on Variants
• Default Safety Lead Time
• Blank Overflow Level
• Combined MPS/MRP Calculation
• Default Dampener Period
• Default Dampener Quantity

Manufacturing Setup

• Dynamic Low-Level Code: Optimizes BOM explosion.
• Components at Location: Specifies where components are picked from.

Other important planning fields

1. Planning Flexibility

This setting controls whether the planning system can adjust supply orders (like production orders) during planning calculations.

Unlimited

• The planning system includes the order line in its calculations.
• It can suggest changes such as:
  • Rescheduling
  • Quantity adjustments
  • Cancellation or replacement

None

• The order line is considered firm and unchangeable.
• The planning system ignores it when generating action messages.
• Useful for manually controlled or confirmed orders.

This setting is available on supply order lines, such as:

• Production orders
• Purchase orders
• Transfer orders

2. Warnings

The Warning Information field on the Planning Worksheet page alerts users to unusual planning situations. Each warning includes a short message, and users can choose to view more details.

Types of Warnings

1. Emergency
   • Indicates critical issues requiring immediate attention.
   • Example: Severe stock shortage or urgent demand not covered by supply.
2. Exception
   • Highlights unexpected or irregular conditions.
   • Example: Supply orders not aligned with demand timing or quantity.
3. Attention
   • Flags non-critical but noteworthy situations.
   • Example: Minor deviations or potential inefficiencies in planning.

These warnings help planners quickly identify and resolve issues during the planning process.

3. Emergency

The Emergency warning appears in two key situations:

1. Negative Inventory on the Planning Start Date
   • Indicates that the item’s inventory is below zero at the beginning of the planning period.
   • The system suggests an emergency supply order to cover the negative quantity.
   • The warning message includes:
     • The planning start date
     • The required quantity

2. Back-Dated Supply or Demand
   • Occurs when document lines (e.g., sales or purchase orders) have due dates earlier than the planning start date.
   • These are consolidated into one emergency supply order scheduled to arrive on the planning start date.

This warning helps planners quickly respond to urgent inventory issues and avoid disruptions in supply.

4. Exception

This warning is triggered when:

• The projected available inventory falls below the safety stock quantity.

System Response

• The planning system suggests a supply order to meet the demand on its due date.
• The warning message includes:
  • The item’s safety stock quantity
  • The date on which the safety stock level is violated

Why It’s an Exception

• Safety stock violations should not occur if the reorder point is correctly configured.
• It signals a planning oversight or a sudden change in demand/supply.

Behaviour of Planning System

• By default, planning parameters are not applied to Exception warnings.
  • The system only suggests supply to cover the exact demand quantity.
• However, you can configure the planning run to respect planning parameters for Exception warnings by enabling:
  • Respect Planning Parameters for Exception Warnings
    (found in the Run Full Planning, MPS, or MRP setup)

5. Attention

This warning appears in two situations:

1. Planning Start Date is Earlier than the Work Date
   • Indicates a mismatch between the planning start date and the current system work date.
   • May suggest outdated or misaligned planning data.
2. Suggested Changes to Released Orders
   • The planning line proposes changes to a released purchase or production order.
   • These orders are typically considered firm, so changes require careful review.

Planner Action Required

• For planning lines with warnings, the Accept Action Message field is not selected by default.
• This ensures the planner reviews and investigates the warning before executing any suggested actions.

Planning worksheets and requisition worksheets

Planning Worksheet

Used for advanced planning activities, including:

• Production, assembly, purchase, and transfer orders
• Supports MPS (Master Production Scheduling) and MRP (Material Requirements Planning)
• Ideal for multi-level production and complex supply chains

Key Features:

• Use Calculate Plan to generate replenishment suggestions
• Use Carry Out Action Message to convert suggestions into actual orders
• Supports sorting by:
  • Item No. (default)
  • Ref. Order No. (for grouping multilevel orders)
  • MPS Order and Planning Level (to show hierarchy)

Printing Production Orders:

• Controlled via Report Selection – Production Order
  • Default: 99000762 Prod. Order – Job Card
  • Alternative: 5500 Prod. Order Comp. and Routing (compact, no routing lines)

Requisition Worksheet

Focused on purchase and transfer planning, especially when production is not involved.

How to Populate:

1. Manual Entry: Add items and fill fields directly.
2. Calculate Plan Batch Job:
   • For items/SKUs with Purchase or Transfer replenishment systems
   • Automatically fills Action Message with suggestions
3. Drop Shipment Action:
   • Uses Get Sales Orders to identify lines for drop shipment
4. Special Order Action:
   • Uses Get Sales Orders to identify lines for special orders
5. From Planning Worksheet:
   • Use Carry Out Action Message to transfer proposals from planning to requisition worksheet
   • Useful when different users handle production vs. purchasing

Editing:

• Lines can be edited or deleted to refine the replenishment plan
• Use Carry Out Action Message to finalize and process orders

Productivity Tips

• Edit in Excel:
  • Available on some worksheet pages
  • Allows bulk editing and syncing back to Business Central
• Sorting Lines:
  • Helps organize and analyse planning data
  • Especially useful for multilevel production orders