DDMRP calculation

#ddmrp

Dynamics 365 Supply Chain Management

The article discusses the implementation and functioning of DDMRP (Demand-Driven Material Requirements Planning) in Microsoft Dynamics 365.
DDMRP is an inventory management methodology that focuses on maintaining the right amount of stock at the right time, taking into account factors like average daily usage, decoupling lead times, minimum and maximum quantities, and reorder points.
The DDMRP system runs daily and generates planned orders when the net flow (on hand + on order
qualified demand) falls below the reorder point.
Qualified demand includes demand past due, today's demand (sales orders), and qualified order spikes (extra orders beyond a certain threshold).
Order spike threshold is a setup available on item coverage, which defines the point where orders are considered extra and not normal.
The DDMRP system considers past due demand, today's demand, and qualified order spikes within the time fence to generate planned orders.
The quantity ordered is calculated as the maximum quantity minus the net flow.
Priority can be used instead of requirement dates to firm orders, and the DDMRP system takes this into account.

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