Concept on Consumption and Reduction

Consumption and reduction happens in different level of a proposal. Below example will show the concept of consumption and reduction.

Example:1

Material : R-F115

Strategy : 10

PIR=100

Sales Order (VA01)=50

Two requirements from IndReq & Order for 100 & 50 pcs will appear on the stock requirement list.

Now we ran MRP.

MRP RUN : MD02

After MRP Run Planned Order was created only for the PIR meaning NO CONSUMPTION. This is the setting of strategy 10 that Sales Order will not be

considered. As well Sales order (Customer requirement)  will not consume the planned independent requirement.

The Planned order should be converted to Production Order -> Release Material -> Confirm all Operation,  Finished Goods receipt (MIGO).. i.e Replenish the the

stock level to 100.

Thereafter  Issue of Material or Goods Issue to Sales Order which will REDUCE the PIR or STOCK LEVEL

Example:2

Material : R-F116

Strategy : 40

PIR=100

Lets consider Sales Order (VA01)=50

Sales Order Immediately CONSUME 50 PCS from the PIR

MRP RUN : MD02

After MRP Run 2 Planned Orders were created separately. Again the reduction will happen once the goods will be issued to Sales order.

Another important thing to notice…

For almost same material (both are FIN product)

PIR with Strategy 10 = MRP Element Data is LSF

PIR with Strategy 40= MRP Element Data is VSF