# SPP – Inventory Balancing – Quantity Control

This blog discusses about controlling the excess/shortage quantity during Inventory balancing run in service parts planning. If you are interested to understand more on basics of inventory balancing and to know its working logic, please visit http://scn.sap.com/docs/DOC-55752 . This will help you in understanding this blog.

As the businesses are not sure of implementing the inventory balancing run because of the multiple STO creation scenario, this control will be very handy to deal during that situation. Multiple STO creation is a scenario in which there are huge numbers of STO getting created out of an Inventory balancing run. The main reasons for this scenario to occur are not maintaining proper of master data and bypassing the cost threshold logic. In some businesses maintaining the cost calculation parameters is very difficult, so if they decide to bypass it then you need this enhancement to control the quantity.

# Steps Involved in Inventory balancing

The following are the basic steps involved in an inventory balancing

1. The system will calculate the Excess/need based on certain formula & horizon which is mentioned in Inventory balancing parameter profile
2. Then the system will carry out a cost benefit analysis based on the parameters & costs which are mentioned in the product master & inventory Balancing service profile
3. Finally if the cost benefit analysis is successful, then the system will create a Stock transfer requisition

# Determination of Excess/Shortage Quantity

For a product, the locations with excess stocks & shortage stocks are calculated and transferred based on the following logic.

Formula for calculating the Excess stock:

Excess = prev. stock – (MAX (reorder point; max. stock) * (1 + excess percentage)

Formula for calculating the Need/shortage stock:

Shortage = unrounded net demand – distribution demand (planned and confirmed) + reorder point * (1 – shortage percentage)

SAP has provided a standard BADI /SAPAPO/SPP_REDEPL to determine/control the shortage/excess calculation. This BADI will get triggered whenever the inventory balancing functionality is executed. For example, if the business wants to maintain a threshold value above which the system calculates the stock as excess, then a custom code can be written in this BADI. In a similar way, business can calculate the shortage quantity also. This can even be controlled through a custom field to

As per the business requirements, a custom code can be written to check the threshold of quantity which can be transferred using Inventory Balancing.

# Technical Steps in Implementation of BADI (/SAPAPO/SPP_REDEPL)

• In Implementation ZX_XX_XX_XXXX a method EXCESS_QTY_CALC is implemented as a part of this object.
• For particular location and material combination read Excess Qty
• IF Threshold Qty < Excess Qty then Excess Qty = Threshold Qty

Using the same approach, we can implement a complex calculation also as per the business logic.

Thanks!

Anand Solomon