This function allows you to simulate purchase review cycles and determine the optimum review cycle for an item line. You can include factors such as vendor minimum values and discounts for the item line in the simulation, and view the resulting net costs. You can use optimum review cycle information to schedule purchase reviews via Work with periodic purchase & order targets. However, the update to this table is not automatic and must be performed manually.
To use the purchase review time simulation, a record for the supplier/line/warehouse combination you want to review must be entered in the Item file and Work with periodic purchase & order targets. See Set up records in Work with periodic purchase & order targets for more information.
Note: Since Work with periodic purchase & order targets is only used for purchase type 2 items, only this item purchase type can be used for purchase review time simulation.
Once you have established the necessary records for a supplier/line/warehouse combination, you can optionally define discounts for the combination. You then use a batch job to create a simulation models. By selecting the model for a specific supplier/line/warehouse, you can determine the optimum review cycle for the combination.
Calculation example
This is an example of how the supplier/line discount can be calculated. The following values are used in the example:
| Supplier number: | 928 MAX95 |
| Line code: | BZ1060 |
| Discount based on: | V1 |
| Discount type: | 1 (percentage) |
| Discount/Values: | Discount: 5, Value: 1000 Discount: 10, Value: 5000 Discount: 12, Value: 7500 Discount: 15, Value: 10000 |
When a purchase review time simulation is created for supplier 928 MAX95, item line BZ1060, the calculation is for the total order value in system currency (V1). When the total order value reaches 1000, a five percent discount is applied to the order; when the total order value reaches 5000, a ten percent discount is applied to the order, and so on.
Enquiries
- Review time simulation file enquiry
- Supplier/line discount enquiry