Why not to ‘Backflush’?
Well, we know that Backflush is used for automatic goods issue during order/operation confirmation. Thus, it’s a great function as it doesn’t involve any manual intervention and components are consumed by the order automatically while posting confirmation.
The backflush can be activated at several levels like Work center, Material Master, Routing or directly in the production order.
However, there are several parameters to be considered while deciding whether to Backflush or to do manual goods issue.
I would like to highlight several cases when you shouldn’t’ choose of Backflush:
- Variance in component consumption: If the component consumption varies for each product or lot then it is not advisable to choose Backflush. Backflush should be used when the component to product ratio is fixed for example you would need two tyres while assembling a bicycle. But whenever the component consumption is not fixed for example in FMCG, Pharma industries etc, you should opt for manual goods issue and capture the actual component consumption.
- Batch consumption varies: The automatic batch determination works on FIFO, LIFO etc. However, if you’re in a specific industry and the business wants to consume a particular batch of a product then you must choose manual goods issue since it gives you flexibility to choose the correct batch during goods issue.
- Long Lead times for production: If the production lead time is significant high for example an operation takes several days, then the components are consumed during confirmation. This could mean there is variance in inventory since the raw materials are actually consumed at the beginning of the process. So it is better to post goods issue at the start of the process.
While there are several advantages of Backflush, there are several disadvantages as well. So, it is quite important to choose wisely whether to Backflush or not.