The calculation of product shortages based on the reorder point has been improved to provide more accurate purchase suggestions.
Previously, shortages were calculated using the following formula: Reorder point – Available stock and backlog.
This calculation has now been enhanced to take lead time in to consideration. The new calculation is:
Reorder point – Effective stock
Effective stock includes:
Available stock
Available quantity in Goods reception items (SSAITEM)
Available purchase backlog expected to be received within lead time, including:
Available quantity in Purchase order response items (SOAITEM) with a confirmed delivery date within lead time
Available quantity in Purchase order response items (SOAITEM) with no confirmed delivery date but a requested delivery date within lead time
Available quantity in Purchase order items (SPOITEM) with a requested delivery date within lead time
Available quantity in Production work order (PWO) which has scheduled completion date within lead time
This updated calculation ensures that incoming purchase quantities expected within lead time are taken into account, reducing unnecessary purchase recommendations.
The change of this calculation will be reflected in the numbers that are suggested to be purchased in Purchase (PUR) application, Requirement plan tab in Product (ART) and in Requirements overview (REO) application.
Note! As a result, we recommend that customers evaluate re‑calculating their existing Reorder Points, since the more accurate calculations may allow for a reduction in reorder points without compromising supply reliability
Note! How leadtime is determined:
If the supplier is not set up for this product: Purchase leadtime from Product (ART) is used and the Company setting (CSV) "Days in week included in purchase lead time" is taken into account. Then the number of days in Leadtime buffer for the combination of product and location is added. If Leadtime buffer is not set, the days in the Company setting (CSV) "Purchase lead time buffer days" are added instead.
If the supplier is set up for this product and has a standard leadtime: Standard leadtime for the supplier is used, and the Company setting (CSV) "Days in week included in purchase lead time" is taken into account. Then the number of days in Leadtime buffer for the combination of product and location is added. If Leadtime buffer is not set, the days in the Company setting (CSV) "Purchase lead time buffer days" are added instead. On top of that, the confirmed delivery date buffer from the supplier is added.
If the supplier is set up for this product, but no standard leadtime: Purchase leadtime from Product (ART) is used and the Company setting (CSV) "Days in week included in purchase lead time" is taken into account. Then the number of days in Leadtime buffer for the combination of product and location is added. If Leadtime buffer is not set, the days in the Company setting (CSV) "Purchase lead time buffer days" are added instead. On top of that, the confirmed delivery date buffer from the supplier is added.
Alberina Shala
Classification: IMPORTANT
The calculation of product shortages based on the reorder point has been improved to provide more accurate purchase suggestions.
Previously, shortages were calculated using the following formula: Reorder point – Available stock and backlog.
This calculation has now been enhanced to take lead time in to consideration. The new calculation is:
Reorder point – Effective stock
Effective stock includes:
This updated calculation ensures that incoming purchase quantities expected within lead time are taken into account, reducing unnecessary purchase recommendations.
The change of this calculation will be reflected in the numbers that are suggested to be purchased in Purchase (PUR) application, Requirement plan tab in Product (ART) and in Requirements overview (REO) application.
Note! As a result, we recommend that customers evaluate re‑calculating their existing Reorder Points, since the more accurate calculations may allow for a reduction in reorder points without compromising supply reliability
Note! How leadtime is determined:
Purchase leadtime from Product (ART) is used and the Company setting (CSV) "Days in week included in purchase lead time" is taken into account. Then the number of days in Leadtime buffer for the combination of product and location is added. If Leadtime buffer is not set, the days in the Company setting (CSV) "Purchase lead time buffer days" are added instead.
Standard leadtime for the supplier is used, and the Company setting (CSV) "Days in week included in purchase lead time" is taken into account. Then the number of days in Leadtime buffer for the combination of product and location is added. If Leadtime buffer is not set, the days in the Company setting (CSV) "Purchase lead time buffer days" are added instead. On top of that, the confirmed delivery date buffer from the supplier is added.
Purchase leadtime from Product (ART) is used and the Company setting (CSV) "Days in week included in purchase lead time" is taken into account. Then the number of days in Leadtime buffer for the combination of product and location is added. If Leadtime buffer is not set, the days in the Company setting (CSV) "Purchase lead time buffer days" are added instead. On top of that, the confirmed delivery date buffer from the supplier is added.
Release date: 3 March 2026