Module: Automatic pairing for overstock at a different warehouse

Executive summary

This module will be deprecated in later versions and will be included as an extension to the module “Overstock identification”. The current description of overstock module is not relevant and will be erased.

Overstock identificaton module shows an information for every PLID (a combination of product + warehouse/store), how big its overstock is, based on selected parameters. After defining the overstock, it is recommended to perform another activity, that results in further handling of the overstock. A situation may happen, when there is overstock in one store and insufficient stock in another store. In this case we could cover the lack of stock by effective distribution of overstock onto other stores and we wouldn’t have to order more goods from suppliers or put discounts on goods in case of overstock.

Example:

• There are many warehouses with overstock and at the same time many warehouses that need to place orders.

  • A pair of warehouses/stores is created: one warehouse with overstock and one warehouse with insufficient stock.

    • In cases where a everyday distribution exists between central warehouse and stores, it is not necessary to create item groups for transport.
    • In cases where everyday distribution does not exist, it is un-economical to transport only smaller amount of products. Only warehouses with idetified larger groups of products are suggested for a potential redistribution of overstock and transport.

Transport may be covered by an external company or dealt with in-house. If the company has its own transportation, it is necessary to include distribution routes into redistribution decision-making. The routes are not important in cases when transport is covered by an external company (PPL or others). To calculate costs and effectivity of these routes, we could use a matrix - a transport from point A to point B is OK (it is cheap), from point B to point A is not OK (expensive). The matrix could also include direct transport costs. If the transport is cheap, usually it is not necessary to use a combination of a matrix and item groups.

A managerial rule is necessary to set for this extension. It should define how many item combinations and stores is effective to redistribute. Example: redistribute only if the system finds a combination of 40 products and warehouses.

This extension may only be implemented based on customer’s demand. The amount of work is based on how complicated are conditions and parameters.