Make-to-Stock

Best Practice Scenario: Make-to-Stock

The Make to Stock business scenario enables your company to produce goods and place them in stock. Your customer demands such as sales orders or service orders can then be covered using this existing stock. You define demand management procedures to define the appropriate make-to-stock strategies that best suit your company’s business requirements. Using forecast demand, you can plan for periodic demand. Customer demands are then covered by this produced or procured stock and consume the forecast demand according to the predefined demand management procedures.
Multi-level supply planning ensures that the goods receipts for all required products, including product specifications, are planned on time which, in turn, means that you can trigger the creation of purchase orders and production orders on time. If all required components are in stock, yon only need to create production orders. Releasing the production order triggers the creation of a production lot and all the necessary production tasks (supply, make, and check) required to commence execution. You use check tasks to ensure the quality of your produced products.
When the final confirmation is complete, the system automatically posts the produced stock to the predefined production output area and triggers inventory and financial accounting updates. From here you use remove tasks to transport the stock to the warehouse.

Process Flow details of Make-to-Stock

Roles involved to Make-to-Stock

• Supply Manager
• Production Planner
• Warehouse Manager
• Warehouse Operator
• Production Operator
• Quality Manager
• Inspector
• Quality Engineer

Business Value of Make-to-Stock

For midsize companies that produce and sell products from inventory, this process integrates planning, production and warehouse management to enable lean manufacturing and keep inventories low.
You can increase customer satisfaction and grow profits by using forecasting capabilities to make sure the right amount of inventory is available.

SAP Business ByDesign helps efficiently manage Make to Stock production environments - from demand planning and forecasting, through production and warehousing to accounting.

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[caption id="attachment_201760" align="aligncenter" width="1024"] The Business Flow of Make to Stock within SAP Business ByDesign[/caption]

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Key Benefits of Make-to-Stock

• Supply planning is closely integrated with production and purchasing to facilitate the seamless handover of production and purchasing proposals for execution;
• Material flow analysis and exception-driven approach provides planners with comprehensive decision support; Multi-level material planning, capacity planning and load leveling can be executed;
• Production and warehouse are based on a unified location layout  which enables demand and consumption-based replenishment to be more efficient hereby ensuring on-time material provisioning for production;
• Production workers are supported by comprehensive task management which guide them through their daily tasks with detailed work instructions;
• Quality inspection is integrated with the production process;
• Management of identified stock (batches, lots) or restricted inventory;
• Automatic inventory valuation for raw materials, WIP, and finished products;
• Built in analytics and reports like stock overview, confirmation journals and batch where-used lists;

Application

• SAP Business ByDesign

Continue to review the other Business Processes SAP Business ByDesign

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