Automated Purchasing Process

Additional Information
Forecasting
Purchasing Criteria
Recalc Forecast, Purch Criteria, Lead Time
Converting Planned POs to Live
Forecast Calc & Demand (PO07&IC45)
Recalculated Lead-Times
Typical Auto Purchasing Cycles

Introduction:

In the Purchasing process, the two most important questions asked are:

    “When Should We Buy?” and
    “How Much Should We Buy?”

To provide an answer to these questions, PointForce Enterprise combines historical data with user-specified values to determine the following 3 calculated criteria:

  1. Forecast - a forecast which estimates the total amount of each Product likely to be sold during the next period. The Forecast is calculated by applying the weightings as set up in the Forecast Calculation Code (Maintain Forecast Calc Codes PO07) to the demand statistics that are accumulated automatically by the system. The demand statistics are visible in Display Product Availability (IC45/C2).

  2. Lead-Time - a per product lead-time which approximates the actual number of days required to receive the goods. Product Lead-Times are maintained for each Product in Maintain Purchasing Info (PO13). Supplier lead-times are also stored by the system in Maintain Supplier Master (PO11) and may be used in place of product-specific lead-times. For more information on Product/Supplier lead-times, please refer to the help for each program.

    • Note: The lead-time consists of the sum of the ‘Production Lead Time Days’ and ‘Transit Lead Time Days’.

  3. Purchasing Criteria - Purchasing criteria are calculated by applying relatively simple mathematical calculations using the forecast and the purchasing criteria codes. The criteria tailor the order quantity for each product purchase. The Purchasing Criteria codes are defined and maintained in Maintain Purchasing Tables (PO09/Purchasing Criteria ) and are assigned to each Product in PO13. The Maximum Factor, Safety Stock Factor and Method of ROQ (Re-Order Quantity) Calculation are set up for each Purchasing Criteria code.

The automated purchasing process includes the following programs:

  • Forecast/Purch/Lead-Time Recalc (PO25) – recalculates the forecast, lead times and stocking levels (purchasing criteria) based on the demand, weighting factors, Purchasing Criteria and Lead-times.

  • Maintain Purchasing Criteria (PO27) – allows you to review and/or edit the Purchasing Criteria changes calculated by PO25 prior to confirming the update to the ‘live’ files.

  • Forecast/Purch/Lead-Time Edit List (PO26) – allows you to print and/or update the Purchasing and Inventory files using the data generated by PO25 and optionally edited by PO27.

  • Generate Preliminary Purchase Orders (PO23) – examines current stock levels, current and future Customer Sales Orders, open Purchase Orders, and the preset Warehouse minimums and maximums for each Product/Primary Supplier combination. If a PO is warranted, a ‘Preliminary Purchase Order’ is created and can be reviewed by the Purchasing agent.

  • Print Preliminary Purchase Orders (PO24) – allows you to print and review the Preliminary Purchase Order generated by PO23. This is an optional program.

  • Maintain Proposed Purchase Orders (PO34) – allows you to review the results of the Preliminary PO generated by PO23, and allows you to add, edit or delete items from the proposal. When the Proposed PO is acceptable, a ‘real’ PO can be generated from the proposal without additional data entry.

  • Create Purchase Orders (PO40) – allows you to review the PO generated by PO34, make any required modifications and then transmit the PO to the Supplier.

For more information on the Automated Purchasing Process, please see the following topics: