Share inventory requirements and visibility with trading partners
Learn how the inventory add-on for SAP Business Network Supply Chain Collaboration enables companies to optimize inventory levels while improving supply predictability through close collaboration, resulting in greater supply assurance, improved customer satisfaction, and better supplier planning and fulfillment. See how this helps you effectively manage working capital, excess inventory, lead times, and carrying costs. Ladda ner dokumentet
Learn how the inventory add-on for SAP Business Network Supply Chain Collaboration enables companies to optimize inventory levels while improving supply predictability through close collaboration, resulting in greater supply assurance, improved customer satisfaction, and better supplier planning and fulfillment. See how this helps you effectively manage working capital, excess inventory, lead times, and carrying costs. Share inventory
requirements and
visibility with trading
partners
Many enterprise buyers deploy supplier-managed
inventory (SMI) programs to enable mutually beneficial
buyer-seller collaboration. Suppliers gain visibility into
buyers’ current inventory and use it to speed response
times, increase fill rates, optimize buyer inventory levels,
and reduce excess safety stocks. All this can lead to
greater assurance of supply and increased process
efficiency.
But most suppliers can access only current, rather
than projected, inventory data, and they use inefficient
tools—such as e-mail, spreadsheets, and homegrown
portals—to collaborate with buyers and plan fulfill-
ment. This leads to an inability to respond to demand
and supply fluctuations and increased lead times
because suppliers must wait for purchase orders (POs)
to replenish inventory. It also drives up the need for
costly emergency orders that result in expedited ship-
ments and unpredictable costs, leaving suppliers
feeling they are continuously acting in a reactive
mode.
SAP Business Network Supply Chain Collaboration,
inventory add-on enables companies to optimize
inventory levels while improving supply predictability
through close collaboration. The result is supply
assurance, improved customer satisfaction, and
better supplier planning and fulfillment that helps
buyers effectively manage working capital, excess
inventory, lead times, and carrying costs.
requirements and
visibility with trading
partners
Many enterprise buyers deploy supplier-managed
inventory (SMI) programs to enable mutually beneficial
buyer-seller collaboration. Suppliers gain visibility into
buyers’ current inventory and use it to speed response
times, increase fill rates, optimize buyer inventory levels,
and reduce excess safety stocks. All this can lead to
greater assurance of supply and increased process
efficiency.
But most suppliers can access only current, rather
than projected, inventory data, and they use inefficient
tools—such as e-mail, spreadsheets, and homegrown
portals—to collaborate with buyers and plan fulfill-
ment. This leads to an inability to respond to demand
and supply fluctuations and increased lead times
because suppliers must wait for purchase orders (POs)
to replenish inventory. It also drives up the need for
costly emergency orders that result in expedited ship-
ments and unpredictable costs, leaving suppliers
feeling they are continuously acting in a reactive
mode.
SAP Business Network Supply Chain Collaboration,
inventory add-on enables companies to optimize
inventory levels while improving supply predictability
through close collaboration. The result is supply
assurance, improved customer satisfaction, and
better supplier planning and fulfillment that helps
buyers effectively manage working capital, excess
inventory, lead times, and carrying costs.
2 | 5
Using the inventory add-on’s dashboard,
suppliers can:
• View demand plans across a predefined hori-
zon, stock on hand, and projected stock alerts
to facilitate compliance
• Gain early visibility into customer demand with
instant calculation of projected inventory across
multiple time buckets
• Plan and execute replenishments against inven-
tory targets—predefined minimum and maximum
(min/max) levels—across the planning horizon
and share them with buyers
Further, buyers can:
• Share demand and forecast plans, stock on
hand, and min/max inventory requirements
with suppliers
• Integrate supplier-created replenishment plans
into ERP software
• Run an SMI program with standard or consigned
stock types
• For consignments, send consumption signals
to suppliers when inventory withdrawals and
ownership transfers occur
• Configure visibility of standard key figures in the
dashboard’s planning view
The figure below illustrates the capabilities of the
inventory add-on.
Figure: Capabilities of SAP Business Network Supply Chain Collaboration, inventory add-on
Using the inventory add-on’s dashboard,
suppliers can:
• View demand plans across a predefined hori-
zon, stock on hand, and projected stock alerts
to facilitate compliance
• Gain early visibility into customer demand with
instant calculation of projected inventory across
multiple time buckets
• Plan and execute replenishments against inven-
tory targets—predefined minimum and maximum
(min/max) levels—across the planning horizon
and share them with buyers
Further, buyers can:
• Share demand and forecast plans, stock on
hand, and min/max inventory requirements
with suppliers
• Integrate supplier-created replenishment plans
into ERP software
• Run an SMI program with standard or consigned
stock types
• For consignments, send consumption signals
to suppliers when inventory withdrawals and
ownership transfers occur
• Configure visibility of standard key figures in the
dashboard’s planning view
The figure below illustrates the capabilities of the
inventory add-on.
Figure: Capabilities of SAP Business Network Supply Chain Collaboration, inventory add-on
3 | 5
Gain visibility and collaborate on
inventory
Using replenishment POs or scheduling agree-
ment releases enabled by the inventory add-on,
suppliers can maintain optimal inventory levels
with a minimum of intervention and time spent
monitoring in- and out-flow in warehouses. By
sharing current inventory and demand data
over the network, stakeholders can gain instant
access to the status of materials needed for
manufacturing.
Visibility is enabled by a dashboard that pro-
vides min/max status, including color-coded
alerts based on stock on hand and projected
inventory calculations. Time-series data on
SAP Business Network is visible to both suppliers
and buyers.
With dynamic push-based replenishment,
inventory is replaced by disclosing future inventory
trends to suppliers. Suppliers can dynamically
calculate min/max levels based on gross demand in
the buyer’s planning horizon, create replenishment
sales orders directly in SAP Business Network,
and ship from the inventory trend without receiving
orders. This means the buyer has enough inventory
in stock to meet its business needs. For these
orders, a PO is created in the supplier’s ERP
system and then sent to the buyer’s system digitally
through SAP Business Network. As a result, when
the order is filled and invoiced, the buyer can
reconcile the order and invoice. Parties involved
can also use the add-on’s dashboard to create
replenishment orders and cancel these orders
within SAP Business Network.
Gain visibility and collaborate on
inventory
Using replenishment POs or scheduling agree-
ment releases enabled by the inventory add-on,
suppliers can maintain optimal inventory levels
with a minimum of intervention and time spent
monitoring in- and out-flow in warehouses. By
sharing current inventory and demand data
over the network, stakeholders can gain instant
access to the status of materials needed for
manufacturing.
Visibility is enabled by a dashboard that pro-
vides min/max status, including color-coded
alerts based on stock on hand and projected
inventory calculations. Time-series data on
SAP Business Network is visible to both suppliers
and buyers.
With dynamic push-based replenishment,
inventory is replaced by disclosing future inventory
trends to suppliers. Suppliers can dynamically
calculate min/max levels based on gross demand in
the buyer’s planning horizon, create replenishment
sales orders directly in SAP Business Network,
and ship from the inventory trend without receiving
orders. This means the buyer has enough inventory
in stock to meet its business needs. For these
orders, a PO is created in the supplier’s ERP
system and then sent to the buyer’s system digitally
through SAP Business Network. As a result, when
the order is filled and invoiced, the buyer can
reconcile the order and invoice. Parties involved
can also use the add-on’s dashboard to create
replenishment orders and cancel these orders
within SAP Business Network.
4 | 5
Augment inventory collaboration with
consignment scenarios
Complement supplier-managed inventory with
support for consignment scenarios where inventory
replenished through SMI isn’t invoiced until it is
used. The invoice is triggered when the buyer pulls
inventory off the shelf as part of the consumption
process.
Consignment consumption reporting accounts for
inventory movements. This visibility helps ensure
the supplier accurately invoices against the with-
drawal. Alternatively, the buyer can self-bill with an
evaluated receipt settlement and send the invoice
to the supplier across the network. The supplier
can also see the scheduled payments and remit-
tance for cash-flow confidence.
There are many benefits of consignment scenarios.
For example, the buyer spends less time working
on inventory replenishment and pays only when
inventory is used. In addition, suppliers can plan
more effectively and control replenishment and
transport with greater accuracy. Fewer emergency
orders mean more regularized and predictable
costs and the opportunity to benefit from econo-
mies of scale.
Extend visibility to contract
manufacturers
Contract manufacturers on SAP Business Network
receive components as part of the contract manu-
facturing process, with visibility into the assumed
stock levels of the components from the ERP
system. This makes it easier to reconcile inven-
tory and helps ensure accurate reporting.
During a contract manufacturer’s production
process, they report on their work-in-process
and real-time component consumption. This infor-
mation flows back to the buyer’s ERP system to
update the component stock levels automatically.
With this increased visibility, buyers and planners
can respond to potential issues more quickly.
Augment inventory collaboration with
consignment scenarios
Complement supplier-managed inventory with
support for consignment scenarios where inventory
replenished through SMI isn’t invoiced until it is
used. The invoice is triggered when the buyer pulls
inventory off the shelf as part of the consumption
process.
Consignment consumption reporting accounts for
inventory movements. This visibility helps ensure
the supplier accurately invoices against the with-
drawal. Alternatively, the buyer can self-bill with an
evaluated receipt settlement and send the invoice
to the supplier across the network. The supplier
can also see the scheduled payments and remit-
tance for cash-flow confidence.
There are many benefits of consignment scenarios.
For example, the buyer spends less time working
on inventory replenishment and pays only when
inventory is used. In addition, suppliers can plan
more effectively and control replenishment and
transport with greater accuracy. Fewer emergency
orders mean more regularized and predictable
costs and the opportunity to benefit from econo-
mies of scale.
Extend visibility to contract
manufacturers
Contract manufacturers on SAP Business Network
receive components as part of the contract manu-
facturing process, with visibility into the assumed
stock levels of the components from the ERP
system. This makes it easier to reconcile inven-
tory and helps ensure accurate reporting.
During a contract manufacturer’s production
process, they report on their work-in-process
and real-time component consumption. This infor-
mation flows back to the buyer’s ERP system to
update the component stock levels automatically.
With this increased visibility, buyers and planners
can respond to potential issues more quickly.
5 | 5
Realize the benefits
With real-time visibility and close collaboration
with suppliers on inventory, buyers can reduce
inventory levels, improve order fill rates, and so
much more.
Our customers report:
• Higher supplier responsiveness with early
visibility into demand and inventories
• Increased productivity and transactional
efficiency across the replenishment cycle
• Improved supplier fill rates, decreased stock-
outs, and reduced overall inventory levels
• Better management of working capital, less
excess inventory, and lower carrying costs
• Optimized inventory levels with improved
supply predictability and quality
• Close collaboration on logistics status so the
right supply is where it’s needed at the right
time
• Improved customer satisfaction and better
supplier planning and fulfillment
Learn more
Visit our supply chain collaboration page and
watch our demo video.
85246enUS (24/11) © 2024 SAP SE or an SAP affiliate company. All rights reserved. See Legal Notice on www.sap.com/legal-notice for use terms, disclaimers, disclosures, or restrictions related to this material.
4%–12%
Lower days inventory
outstanding
Source: Performance benchmarking studies from SAP.
9%–25%
Lower FTE costs
8%–23%
Lower revenue loss
due to stock-outs
Realize the benefits
With real-time visibility and close collaboration
with suppliers on inventory, buyers can reduce
inventory levels, improve order fill rates, and so
much more.
Our customers report:
• Higher supplier responsiveness with early
visibility into demand and inventories
• Increased productivity and transactional
efficiency across the replenishment cycle
• Improved supplier fill rates, decreased stock-
outs, and reduced overall inventory levels
• Better management of working capital, less
excess inventory, and lower carrying costs
• Optimized inventory levels with improved
supply predictability and quality
• Close collaboration on logistics status so the
right supply is where it’s needed at the right
time
• Improved customer satisfaction and better
supplier planning and fulfillment
Learn more
Visit our supply chain collaboration page and
watch our demo video.
85246enUS (24/11) © 2024 SAP SE or an SAP affiliate company. All rights reserved. See Legal Notice on www.sap.com/legal-notice for use terms, disclaimers, disclosures, or restrictions related to this material.
4%–12%
Lower days inventory
outstanding
Source: Performance benchmarking studies from SAP.
9%–25%
Lower FTE costs
8%–23%
Lower revenue loss
due to stock-outs