When a product is sold more than was anticipated previously, you might want to purchase it from your supplier as soon as possible. When you do not want to wait to purchase until your regular planned order moment, Optiply can automatically plan additional purchase orders or prepone your existing planning.
How to turn on a dynamic emergency planning for a supplier
Go to the Suppliers page
Select the supplier you would like to setup
Scroll down to EMERGENCY ORDERS > and turn ON the Avoid lost sales functionality.
Optiply will now update the planning if there are products with expected lost sales. You can determine if you would like the system to take the fixed order costs into account and/or the minimum order value.
Planning adjustments
You have full control over when the planning is updated:
To see if we should update the planning, Optiply first checks if profit will be made based on the expected lost sales and the desired service level. If this is not the case, the planning will not be updated.
If there is unwanted profit at stake, Optiply will update the planning based on the order value, order cost and minimum order value:
If (a multiple of) the fixed order costs are taken into account, we will plan emergency orders if
order value > fixed order costs
If (a multiple of) the minimum order value is taken into account, we will plan emergency orders if:
order value > minimum order value
If the fixed order costs AND the fixed order costs are taken into account, we will plan emergency orders if
order value > fixed order costs + minimum order value
Emergency vs Preponed Orders
We choose between planning an extra emergency order or preponing the planning based on the profit that will be made on each option. An additional order brings more results in extra ordering costs, while a preponed order results in more inventory costs.
Combining Emergency & Preponed Orders with Backorders
When the backorder functionality is turned on, additional orders might already be planned based on the backorder requirements. If this is the case we will update the order to an Emergency or Preponed Order if there are expected lost sales as well.
The dynamic planning is reevaluated every day and continuously updated during the day.