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More discussions in SAP ERP - Logistics Materials Management (SAP MM)
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4 Replies Latest reply: Jun 24, 2010 1:42 PMby INDRANIL BHATTACHARYYA
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CONSUMPTION BASED PLANNING ?
This question has been Answered.
hii

What is Consumption based planning ?

what kind of planning scenario's will comes under CBP???

Major configuration in CBP in MMpoint of view ??

Thanks
MM team Jun 24, 2010 1:39 PM
Correct Answer
by ANONYMOUS ANONYMOUS on Mar 1, 2012 10:33 AM
Consumption-Based Planning

Purpose

The central role of MRP is to monitor stocks and in particular, to automatically create procurement
proposals for purchasing and production (planned orders, purchase requisitions or delivery
schedules). This target is achieved by using various materials planning methods which each
cover different procedures.

Consumption-based planning is based on past consumption values and uses the forecast or
other statistical procedures to determine future requirements. The procedures in consumption-
based planning do not refer to the master production schedule. That is, the net requirements
calculation is not triggered either by planned independent requirements or dependent
requirement. Instead, it is triggered when stock levels fall below a predefined reorder point or by
forecast requirements calculated using past consumption values.

Implementation Considerations

Consumption-based planning procedures are simple materials planning procedures, which you
can use to achieve, set targets with relatively little effort. Therefore, these planning procedures are
used in areas without in-house production and/or in production plants for planning both B- and C-
parts and operating supplies.

The prerequisites for implementing consumption-based planning are:

If you use forecast requirements, the consumption pattern should be fairly constant or linear
with few irregularities.
Your Inventory Management must function well and should always be up-to-date.

Integration

Consumption-based planning is integrated in the Materials Management component. You can
access the consumption-based planning functions from the SAP Easy Access Menu by choosing
Logistics Materials Management Materials Planning MRP.

See also: Overview of the Transaction Codes for Consumption-Based Planning

Features

MRP Procedures

In consumption-based planning, the following MRP procedures are available:

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Re: What is consumption based planning &
configuration settings to be done for
consumption based planning?
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Reorder point procedure
Forecast-based planning
Time-phased materials planning

Creation of procurement proposals

The type of procurement proposal to be created automatically in the planning run depends on the
procurement type of the material. For in-house production, the system always creates a planned
order. For external procurement, the MRP controller can choose between a planned order and a
purchase requisition. If the MRP controller chooses a planned order, it then has to be converted
into a purchase requisition in a separate step so that it is made available to Purchasing.

The advantage of creating a planned order is that the MRP controller has more control over the
procurement proposals. The purchasing department cannot order the material until the MRP
controller has checked and converted the order proposal. If a purchase requisition is created, it is
immediately available to the purchasing department, which then takes over the responsibility for
material availability and warehouse stocks.

Planning at plant level or for MRP areas

As materials planning is usually carried out at plant level, all available stock in the plant (from now
on described as available warehouse stock) is taken into account during planning. However,
stocks from individual storage locations can be excluded from requirements planning or they can
be planned independently. These stocks are then not included in material requirements planning
at plant level. On the other hand, consignment stocks from the vendor are always included in MRP.

You can also carry out MRP for individual MRP areas. You can define the MRP areas. This means,
for example, that you can group several storage locations into one MRP area and carry out MRP for
this MRP area.

Lot-sizing procedures

The standard lot-sizing procedures are available in the R/3 System. However, you can quite easily
integrate your own formulas without much effort.

Automatic planning run

The automatic planning run determines shortages and creates the appropriate procurement
elements. The system creates notes for critical parts and exceptional situations providing you with
the necessary information for processing the planning results.
Leaving content frame

refer the links
http://help.sap.com/saphelp_47x200/helpdata/en/7d/c27097454011d182b40000e829fbfe/frameset.htm
http://help.sap.com/saphelp_47x200/helpdata/en/a5/e82be6a27311d3a82e0000e82a3c24/frameset.htm

See the answer in context
Helpful Answer by chakrapani reddy
Re: CONSUMPTION BASED PLANNING?
http://help.sap.com/printdocu/core/print46c/en/data/pdf/MMCBPCBP/MMCBPCBP.pdf
http://help.sap.com/saphelp_di471/helpdata/EN/56/4ff5cd40e211d3b49b006094b9c9be/content.htm
http://sapdocs.info/sap/materials-management-2/mrp-vs-consumption-based-planning/
http://www.sapstudymaterials.com/2008/05/materials-planning-procedures-in-sap.html
http://www.sdm-c.com/files/SCM2009_Mazliach_implement.ppt

Regards,

Indranil
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INDRANIL BHATTACHARYYA Jun 24, 2010 1:42 PM (in response to MMteam)
Re: CONSUMPTION BASED PLANNING?
Guest Jun 24, 2010 1:44 PM (in response to MMteam)
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Consumption based planning is done for the consumables in manufacturing industry for items like
eg.Cotton Rags, screws, greese etc.

as far as configuration goes below need to be done

a) T.Code : OMI8 - Maintain Plant Parameters

b) T.Code : OPPR - Maintain MRP Group (CBP can also be done without MRP Group settings)

Master Data Settings

a) Material master needs to be maintaned with MRP Views

b) MRP type - VB ( if manual Reorder point is used) and Lot Size - HB ( Replenish to maximum stock
level)
There are different MRP types for CBP which comes standard eg.V1, V2, VM

For example we consider Manual Reorder point planning, we have set the reorder level as 5 and
maximum stock level is 20, we will consider the current stock is 4, planning file entry is created once
the stock level falls below the reorder point level, when MRP is run a Procurement proposal is
created for 16nos (consider the current stock is 4).

OTHER EXPLANATION

Configurations for CBP as explained before.

a) Plant Parameters - t.Code : OMI8, when you execute this t.Code you will get several tabs like for
ex.Number ranges, MRP Controllers etc... you need to maintain those are relevant
MRP Controllers, Number ranges, Available stock most of these tabs are mandatory configurations.

MRP Controllers - Defined and assigned to the plants, MRP Controllers are the planners who are
responsible when it comes to the materials.
Number ranges : Planned orders, Purchase requesitions
Available Stock : whether stocks in transit, Blocked stock, Restricted stock are to be considered or
not.
Planning Horizon - 100 days.. during MRP run those materials for which planning file entry is created
and within the next 100days will be calculated for MRP.

b) MRP Group is not a mandatory config.
In case you need have configured new document type this can be entered in the "External
Procurement per MRP Group" tab and this MRP group can be assigned to the material mster, based
on this assignment the document type is picked up.

Each tab has its own significance, Please go through the configuration notes in SPRO you will get a
better idea. let me know if you have futher clarifications.

Edited by: Afshad Irani on Jun 24, 2010 4:43 PM
Like (1)
Re: CONSUMPTION BASED PLANNING?
for CBP configuraton setting you can check at SPRO > MM> consumption based planning
in CBP planning will be based of historical values/ past consumption data
Alert Moderator Like (0)
Helpful Answer
chakrapani reddy Jun 24, 2010 1:45 PM (in response to MMteam)
Re: CONSUMPTION BASED PLANNING?
Consumption-Based Planning

Purpose

The central role of MRP is to monitor stocks and in particular, to automatically create procurement
proposals for purchasing and production (planned orders, purchase requisitions or delivery
schedules). This target is achieved by using various materials planning methods which each cover
different procedures.

Consumption-based planning is based on past consumption values and uses the forecast or other
statistical procedures to determine future requirements. The procedures in consumption-based
planning do not refer to the master production schedule. That is, the net requirements calculation is
not triggered either by planned independent requirements or dependent requirement. Instead, it is
triggered when stock levels fall below a predefined reorder point or by forecast requirements
calculated using past consumption values.

Implementation Considerations

Correct Answer
Guest Mar 1, 2012 10:33 AM (in response to MMteam)
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Consumption-based planning procedures are simple materials planning procedures, which you can
use to achieve, set targets with relatively little effort. Therefore, these planning procedures are used
in areas without in-house production and/or in production plants for planning both B- and C-parts
and operating supplies.

The prerequisites for implementing consumption-based planning are:

If you use forecast requirements, the consumption pattern should be fairly constant or linear
with few irregularities.
Your Inventory Management must function well and should always be up-to-date.

Integration

Consumption-based planning is integrated in the Materials Management component. You can
access the consumption-based planning functions from the SAP Easy Access Menu by choosing
Logistics Materials Management Materials Planning MRP.

See also: Overview of the Transaction Codes for Consumption-Based Planning

Features

MRP Procedures

In consumption-based planning, the following MRP procedures are available:

Reorder point procedure
Forecast-based planning
Time-phased materials planning

Creation of procurement proposals

The type of procurement proposal to be created automatically in the planning run depends on the
procurement type of the material. For in-house production, the system always creates a planned
order. For external procurement, the MRP controller can choose between a planned order and a
purchase requisition. If the MRP controller chooses a planned order, it then has to be converted into
a purchase requisition in a separate step so that it is made available to Purchasing.

The advantage of creating a planned order is that the MRP controller has more control over the
procurement proposals. The purchasing department cannot order the material until the MRP
controller has checked and converted the order proposal. If a purchase requisition is created, it is
immediately available to the purchasing department, which then takes over the responsibility for
material availability and warehouse stocks.

Planning at plant level or for MRP areas

As materials planning is usually carried out at plant level, all available stock in the plant (from now on
described as available warehouse stock) is taken into account during planning. However, stocks
from individual storage locations can be excluded from requirements planning or they can be
planned independently. These stocks are then not included in material requirements planning at
plant level. On the other hand, consignment stocks from the vendor are always included in MRP.

You can also carry out MRP for individual MRP areas. You can define the MRP areas. This means, for
example, that you can group several storage locations into one MRP area and carry out MRP for this
MRP area.

Lot-sizing procedures

The standard lot-sizing procedures are available in the R/3 System. However, you can quite easily
integrate your own formulas without much effort.

Automatic planning run

The automatic planning run determines shortages and creates the appropriate procurement
elements. The system creates notes for critical parts and exceptional situations providing you with
the necessary information for processing the planning results.
Leaving content frame

refer the links
http://help.sap.com/saphelp_47x200/helpdata/en/7d/c27097454011d182b40000e829fbfe/frameset.htm
http://help.sap.com/saphelp_47x200/helpdata/en/a5/e82be6a27311d3a82e0000e82a3c24/frameset.htm

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