Automating stock replenishment and procurement

Using reordering rules for stock items

You can automate procurement/replenishment for made-to-stock items using reordering rules. A reordering rule is a minimum stock rule that is used to ensure that you always have a minimum amount of stock for a product. When the stock level falls below the minimum stock rule, a procurement is automatically generated to replenish the product stock. A procurement, depending on the Routes specified in the product form, can either be a manufacturing order or a purchase order.

A reordering rule for a product with the Buy route will automatically trigger a draft purchase order when there is a demand.

A reordering rule for a product with the Manufacture will automatically trigger a manufacturing order when there is a demand.

Configuring a reordering rule

To configure a reordering rule for a product, go to Inventory -> Configuration-> Products -> Reordering Rules and click on the Create button. Enter the details in the form and click on the Save button.

You can also access reordering rules for a product using the quick links at the top of the product form.

Example

The procurement will be automatically generated to replenish stock to the maximum quantity when the stock level for the product falls below the minimum quantity. Consider the reordering rule shown in the screenshot above as an example. Assuming the product has been set up with a Buy route and the current stock level is 4 Units, a draft purchase order is automatically generated for 6 Units. (maximum quantity - current stock level. i.e 10 Units - 4 Units).

For the automatic procurement to be generated, you must set up product vendors (for bought to stock items) or a bill of materials (for manufactured items).

Reordering rules can also be defined for specific warehouse locations if you have enabled the Multi-warehouses and Storage locations settings from Inventory -> Settings -> Configuration

Scheduler

Procurements are generated by an automated scheduler that runs every 24 hours. However, you can also trigger the scheduler manually using the Inventory -> Run Scheduler menu.

Automating replenishment for made to order items

To automate replenishment for made-to-order items, you should set up a reordering rule with minimum and maximum quantities as 0, Preferred Route as Buy or Manufacture as required, and Trigger as Auto. You may need to enable Trigger and Preferred Route fields from the list as shown below:

For example, if you have 10 quantities of a product in stock, and a sales order for 25 quantities is confirmed, a manufacturing order for the additional 15 quantities will be automatically generated. Similarly, if this product is defined as a component in a BoM (for another product), then a manufacturing order is automatically triggered when there is a demand for the finished product.