Create projected purchase orders, vendor returns, and stock transfers

1. Go to Purchasing > Forecast > Project Purchase Order.

   

2. Make sure the Projection tab is selected.
3. On the Criteria Selection screen, choose options to narrow the data set on which projections will be given.
   Criteria options defined:

   • Product Criteria The product selection criteria allows projections to be performed for specific products (such as an entire Product Line).
   • BuyerAll Buyers assigned to a Vendor. When a Buyer is selected, only their assigned Vendors will appear in the Summary Results. This will default to the current logged in Buyer automatically, though this can be cleared to view all Vendors.
   • VendorLeave blank to project for all vendors, or choose a specific vendor. For Vendors to display in the Summary Results they must have Lead Days & Turn Cycles set in the Vendor Master.
   • Lead Days & Turn Cycles Together, Lead Days & Turn Cycles determine the number of Weeks for which you want to project. Lead Days: The number of calendar days that it takes to receive an item ordered from the vendor. Turn Cycles: The number of times per year that you order from the vendor. For example, weekly orders would amount to 52 turns and monthly orders would amount to 12 turns. For example: Having 7 Lead Days from a vendor amounts to one week. Combined with 52 Turn Cycles, your projection would request 2 weeks worth of inventory.
   • Display Zeros Enabling this setting includes products in the projection that currently do not need to be purchased. Note: Non-stock products will not be included.
   • Project to meet Vendor Requirements Projecting to Meet Vendor Requirements allows you to round your purchase order up to reach the vendors Dollar, Weight, or Volume requirement (as set in the Vendor Master). When selected, the initial PO projection is generated. If the recommend purchase amount falls short of the requirements, the reorder quantities will be continually increased until the minimum is met. Note: These options do not affect suggested reorder amount on the Vendor Summary Results.
   • Project from Open Sales Orders Only Includes only products that are currently backordered on open Sales Orders in the projection results.
   • Include Uncommitted Sales Orders Includes inventory that has been Uncommitted on Sales Orders in the projection results. This is useful when purchasing for future orders (typically future orders are uncommitted based on either the Ship/Promise Date fields set on the Sales Order).
   • Project with Minimum Quantities Overrides the system calculated Recommended Purchase Quantity and uses the Min Stock Qty of the product instead. If the product does not have a Min Stock Qty, then the system calculated value will be used. Note that this option does not affect suggested reorder amount on the Vendor Summary Results. Alternatively, enabling the Forecast Parameter of 'Build Forecast Screen Projecting with Minimum Quantities only' will effect the Vendor Summary Results.
   • Auto-Link Sales Orders Links products on open Sales Orders to the Purchase Order created from the projection. This allows for greater inventory visibility, as it will now be possible for the order writers to see when their special orders are expected to arrive.
   • Critical Items Only If enabled your projection results will be limited to products that have fallen below their Reorder Point (ROP). This mimics the functionality of the Critical Inventory Report and allows you to focus on the most vital purchases first. When using this option it is recommended to create a PO (for the critical items of a vendor), then run a projection for the vendor a second time (this time with Critical Only un-checked). This will allow you to add your projection to the existing critical PO prior to submitting your order to the vendor. Reorder Point Calculation: Weekly Demand x Lead Days (in weeks) + Safety Stock This system-calculated field is based on Lead Days & Safety Stock % (as set in the Product Master) and the average weekly demand for the last 12 months. If no Safety Stock % is set for a product, a default value of 20% is used. Example: A product has a weekly demand of 10, a safety stock of 20%, and takes 14 lead days to arrive. 10 (Per week) x 2 (Weeks to arrive) + 20% (Safety Stock) = 24 (ROP) Note: If a Min Stock Qty is set on a product, the higher of the two values is used as the ROP.
   • Starting Month for Pre-season Order Allows an upcoming month to be selected for pre-season purchasing. A Future OnHand value is calculated by deducting estimated sales from the Current OnHand. Estimated sales are calculated by multiplying the Weekly Average of a product against the number of weeks to the selected month. Other factors like Committed or OnPO remain the same, except they are now applied against the Future OnHand to determine the Future Available. For example, assume the current month is August and a pre-season order for November is taking place. This is 3 months away, which is multiplied by 4.3 to determine the number of weeks (12.9). The Weekly Average of the product is then multiplied by the weeks (12.9) to determine Estimated Sales. Note that the OnHand column displays the Future value and the Weekly Average is the forecasted value (based on forecast parameters, formulas, etc).
   • Warehouses Select which warehouses to include in the projection. This allows for purchases to be made for single or multiple warehouses. When buying for multiple warehouses, stock transfers will be created out of the Receiving Warehouse. When multiple warehouses are selected the following will happen: -Excess quantities (to meet Box Quantity or Min PO Order Amounts) will be placed into the Receiving Warehouse. -If the Receiving Warehouse is not part of the selection, it will still be included in the projection to handle the excess quantities. -Stock transfers will be created at the time your Purchase Order is saved. -Stock transfers will be completely backordered (as long as Quantity Pick Logic is enabled in the Company Master).

   Tip: To display only Sales orders that have open back orders, select the Auto-Link Sales Orders check box and set the Company Master option Display All Sales Orders to Yes.

4. Click the Generate Summary button.
5. The Vendor Summary Results displays all vendors where a purchase order is recommended, based on the Lead Days & Turn Cycles set in the Vendor Master, which are used to determine the number of weeks of inventory to purchase.

   

   Review the summary results

   • Minimum Purchase The minimum order dollars that must be met to place an order. This value comes from the Vendor Master.
   • Free Freight The freight amount that must be met to qualify for free freight. This value is defined in the Vendor Master.
   • Free Freight Shortage The difference between the recommended purchase amount and the amount required to qualify for free freight.
   • Carrying Cost The cost of warehousing excess product when projecting to meet vendor freight requirements. Use this value to help you decide if a larger purchase order that qualified for free freight is worth the cost of keeping extra inventory in your warehouse. This value is calculated as a percentage of the Free Freight Shortage. You can configure that percentage using the Carrying Cost Percentage option on the Forecast Parameters. Note that this value if for your reference only and does not impact any generated reorder quantities.
   • Recommended Purchase The suggested purchase amount, based on the Lead Days & Turn Cycles to determine the number of weeks worth of inventory to purchase. This value is used in conjunction with the forcast methods to determine how much product is required for the given weeks. Note that if the Vendor has no Lead Days & Turn Cycles configured, then they will be excluded from the Vendor Summary Results.
   • Weight The total weight of the projected purchase order. This value is calculated by adding the extended weigt for all products on the initial forecast projected. Product weight is configured in the Product Master.
   • Volume The total volume of the projected purchase order. This volume is calculated by adding up the extended volume for all products on the intial forecasted projection. Volume is specified on the Product Master.
   • Quantity The total number of items to order.
   • Meets Minimums At least on vendor minimum–Weight, Quantity, Volume, Order Details, or Freight Dollars–has been met. These minimums are specified the Vendor Master.
   • Low Priority Indicates which vendors are a low priority for creating projected purchase orders, as indicated on the Vendor Master>Purchasing tab. Sort this column to push low priority vendors to the bottom so that you can address high priority purchase orders first.

   Minimum vendor requirements such as Order Dollars or Free Freight qualifiers are displayed. The Carrying Cost will indicate the costs associated with warehousing excess purchase quantities when meeting free freight requirements.

   Note: If the vendor is missing Lead Days & Turn Cycles, they will not appear in this Vendor Summary Results.

6. To review the projection details, click the Go button on the projection line item.

   

7. The Projection Results displays the system recommended purchase order based on a combination of Forecast Formula's, Max Stock Quantities, & Forecast Parameters.

   

   Hover over the recommended purchase quantity for a detailed breakdown of the methodology used to determined the Reorder Quantity.

   

   Switch between warehouses to view and modify purchases by each location. Outgoing stock transfers will be created automatically in the Receiving Warehouse for multiple warehouse purchase orders.

   More projection details

   • Lead Days and Turns Lead Days & Turn Cycles are used in conjunction to determine the number of Weeks you wish to project for. Lead Days: The number of calendar days that it takes to receive an item ordered from the vendor. Turn Cycles: The number of times per year that you order from the vendor. For example, weekly orders would amount to 52 turns and monthly orders would amount to 12 turns. Example: Having 7 Lead Days from a vendor amounts to one week. Combined with 52 Turn Cycles, your projection would request 2 weeks worth of inventory.
   • Purchase Quantity The number of items to be ordered from the vendor. This value populated with the system forecast, which typically is calculated by the Forecast Formula or the Max Stock Quantity for the number of weeks being purchased. Hovering over this value displays a breakdown of how the projection was calculated.
   • Commtd+OutTrns Committed plus Outgoing Transfers. The quantity outbound from the current open sales orders and outgoing stock transfers.
   • OnP/O+InTrns On Purchase order plus Incoming Transfers. The net available quantity by reducing outbound inventory (sales orders and outgoing stock transfers) from the current on hand and adding inbound inventory (purchase orders and incoming stock transfers). Helps to identify expected inventory levels when all open orders are completed. The recommended purchase quantities are based on this net available quantity.
   • 12 Mon Demand The number of units of the product purchased and shipped from the warehouse over the last 12 months.
   • Current Inventory The current inventory levels of the product in the selected warehouse.
   • ForecastThe expected demand for a given period, based on Forecast Formula, Max Stock Quantity, or median average.
   • Sales Order Commitments All sales orders with committed quantities. If the criteria option to "Include Uncommitted Sales Orders" is selected, then both committed and uncommited quanities appear. To link the purchase order (once created) to the sales order, select the check box. If you have selected the criteria, "Auto-Link Sales Orders," then the check box is selected by default.
   • Product Informaiton from the Product Master, including the PO Cost of the product. Min and Mz Stock Quantities display the warheouse specific value if one is available.
   • Demand Average usage based on the previous 12 month demand. This information is for your reference and is not used in generating the projection. Although the Demand Trend does not impact projection by default, you may modify these settings in the Forecast Parameters.
   • Last Vendor Purchase Information The last purchase order for the selected product for each vendor from whom you purchased it.
   • Status.

     • D Demand Trend : Indicates the product has a Demand Trend greater than 25%.

       (By default, a Forecast Parameter caps Demand Trend influence at 25%).

     • H: High Forecast Error: The Procurement Forecast Assignment was unable to assign an adequate formula.

       (By default, a Forecast Parameter does not assign a formula if it does not come within 80% of historical usage).

     • L: Lead Days: The products lead days are more than 1.5x greater than the lead days set in the projection.
     • N: Non-Stock: The product has a status of Non-Stock.
     • I: Inactive/Discontinued: The product has a status of Inactive or Discontinued.
     • R: Purchase History Link: The product's demand is linked to another product via the Purchase History Link in the Product Master.
     • O: Overstock: The product has excess overstock available in another warehouse determined by the formula below:
       • Max On Hand = Weekly Avg * Buying Weeks (the number of weeks in the projection)
       • Excess Avail = Avail - Min Stock Qty (ROP)
       • Excess On Hand = Excess Avail - Max On Hand
       • Excess Weeks = Excess On Hand / Weekly Avg

       If the Excess Weeks is greater than the Forecast Parameter (which defaults to 8 weeks), in any warehouse other than the one selected, the product is Overstocked.

8. Click Create P/O.

   

   • To add this product to an existing open purchase order with the vendor, click Search, and then click to Purchase Order #.

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   • Otherwise click New.
9. When the Purchase Order Entry screen appears, click Save to finalize the order.

   

Follow the procedure above, but on the Criteria Selection screen (step 3), choose the specific vendor for whom you want to generate projections.

Use this procedure to create a purchase order for all returns going to a specific vendor. These returns are projected based on products that have too much inventory in stock. Inform calculates how much is too much based on the Number of Reorder Points On Hand. Inform will project that you should return whatever inventory in uncommitted, unless you have a minimum quantity set.

You can also choose to return a custom amount of inventory based on the number of weeks available on hand. For example, if you choose 3 weeks, then Inform will show you all products with more than 3 weeks available on hand, and allow you to created a vendor return for the excess quantity.

1. Go to Purchasing > Forecast > Project Purchase Order.

   Make sure the Vendors Returns tab is selected.

   

2. Choose the Vendor for whom you want to create the return.
   • To generated projected returns by products with more than the specified Number of Re-order Points on Hand, type the number of ROPs into the box provided. OR 
   • To generate projected returns based on a number of Weeks Available on Hand, type the number of weeks into the box provided. Inform will return all products that have more than that number of weeks available inventory on hand.
   • Specify any additional applicable criteria.
3. Click Generate Transfer.
4. The remainder of the procedure follows the steps of the Vendor Projected PO described above, except you will be creating a negative purchase order for the vendor return.

There are three methods of creating stock transfers during projection.

Manual Transfer

This method is used to create stock transfers on-the-fly during Projected PO. This allows purchasing agents to balance inventory across warehouses rather than purchase material from a vendor.

1. Within the Projection Results screen, expand a product, and then right-click a warehouse and choose the Transfer From option.

   

2. Review the Transfer From pop-up and enter the quantity you wish to transfer in the Quantity Transfer column.

   

3. When you are ready to complete your projection click the Create Transfers & P/O button.
   • Stock transfers will be created immediately for each outgoing warehouse.
   • A prompt to print each transfer will appear.

Consolidated Purchase Order

When purchasing for multiple warehouses, all inventory is brought into the Receiving Warehouse. Stock transfers are automatically created to replenish the warehouses upon the products arrival.

• The stock transfer will be created when the Purchase Order is saved.
• Stock transfer quantities will be completely backordered.
  • This requires the Company Master setting Use Quantity Pick Logic in Stock Transfer
• Automatic Backorder Release can print Stock Transfer Release paperwork.
• Releases will only occur on line items that have been received.

Projected Transfer

Use this method to project a specific warehouse's requirements, and then transfer product rather than purchase it.

1. Go to Purchasing > Forecast > Project Purchase Order.

   Make sure the Stock Transfer tab is selected.

   

2. Choose your stock transfer criteria. You'll find a subset of the options described in step 3 above, Criteria, In addition, make sure you choose the warehouses between which you want to transfer stock in the From Warehouse and To Warehouse.
3. Click Generate Transfer.
4. The remainder of the procedure follows the steps of the Vendor Projected PO described above, except you will be creating a stock transfer.

   Note: This projection does not take into account the availability of the product in the From Warehouse. Out of stock products in the From Warehouse will still be transferred.