1:07 PM
How to
Calculate Production Planning - Techniques
/ Formula / Policy
I have received many queries from
students and practitioners of Supply Chain that how to calculate Production Planning. Here I am shortly
given them advise to calculate the Production Planning as per below formula, which
will help you to calculate your objective results.
Forecast = Dispatch to Distributor + Direct sale
+ Export sale forecast
Dispatch to
Distributor = (Current month + Next 2 months) Forecast for Distributor –
Distributor current month opening inventory
Direct Sale
= Local Sales from Company FG store
Safety Stock for Current
Month = ( ( Current + next two
months ) Rolling Forecast
/ 90 ) x safety stock days
Order Lots = (
Quantity to Produce) / Batch Size
To detail working for an ERP system you’ll need to establish
below pre-requisite policies to get the desire results of Production Planning System.
Establish the following policies:
- Finished Product Inventory Policy.
- Raw & Packing min / max Inventory Policy.
- Planning Cycle
- Define Machine Capacity
- Define Process Name product wise. Mfg / Pkg
- Define Machine Name.
- Define Total Machine Hours
- Define Total Labour Hours
- Define No of person process wise
- Machine hour rate
- Labour hour rate
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