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<ManualTopic ID="/baanerp/wh/onlinemanual/000464" xml:lang="en">
   <Header>
      <Title>Supply planning by customer</Title>
      <Keyword type="header" order="d1e3004346">
         <Level1>VMI</Level1>
         <Level2>supply planning by customer</Level2>
      </Keyword>
      <Keyword type="header" order="d1e3004351">
         <Level1>Scenario</Level1>
         <Level2>supply planning by customer</Level2>
      </Keyword>
   </Header>
   <AimSection ID="Supply_planning_by_cust">
      <Paragraph>The customer receives components from stock managed and owned by
		the supplier. The customer performs supply planning for the components. In this
		scenario, the supplier manages the <Link href="/baanerp/wh/glossary/glossary#000471" role="glossary">VMI warehouse</Link>, which is modeled as a regular warehouse in
		their ERP system. In the customer's ERP system, the VMI warehouse is modeled as
		an <Link href="/baanerp/wh/glossary/glossary#000467" role="glossary">administrative warehouse</Link> in which inventory levels are
		maintained for planning reasons. Usually, the ownership change rule is time
		based or consumption based. For further information, see <Link href="/baanerp/wh/onlinemanual/000474" role="manual">Consumption-based ownership change</Link> or <Link href="/baanerp/wh/onlinemanual/000473" role="manual">Time-based ownership change</Link>.</Paragraph>
   </AimSection>
   <ProcedureSection>
      <Steps>
         <Step ID="Suppl_planning_by_cust_step1">
            <StepTitle>Customer plans supply</StepTitle>
            <Paragraph>The customer plans the component supply required for
			 production. The planning is based on the customer's current inventory, the firm
			 demand, that is, outstanding sales orders or sales schedules, and the
			 unconfirmed forecasted demand.</Paragraph>
            <Paragraph>The resulting supply plan consists of a range of dates and
			 times on which particular quantities are to be delivered. Ths supply plan
			 includes a firm part and a planned, that is, unconfirmed part. In the contract
			 between the supplier and the customer, the dividing line between firm and
			 planned demand is laid down. Typically, the demand dated before a particular
			 time fence is to be regarded as firm demand.</Paragraph>
            <Paragraph>If the supply plan includes firm and planned demand, the
			 customer typically uses <Link href="/baanerp/td/glossary/glossary#000000000000011" role="glossary"
                     Update="No">purchase schedules</Link>. If it
			 only includes firm demand, the customer uses purchase orders.</Paragraph>
            <Paragraph>The customer will not request replenishment while having
			 sufficient owned stock. If the owned stock partially covers the demand, the
			 customer allocates owned stock before supplier-owned stock. Another example is
			 if the customer has issued or consumed more components than required for
			 production, and brings the surplus back to the VMI warehouse, while remaining
			 the owner of these components.</Paragraph>
            <Paragraph>The customer sends the supply plan to the
			 supplier.</Paragraph>
         </Step>
         <Step ID="Suppl_planning_by_cust_step2_supp_commits">
            <StepTitle>Supplier commits to supply plan</StepTitle>
            <Paragraph>The supplier checks whether they can fulfill the customer's
			 requirements and commits themselves to the quantities that they can deliver
			 according to the date/time schedule of the supply plan.</Paragraph>
            <Paragraph>Optionally, the supplier commits themselves to the firm
			 demand and the planned demand. For the planned demand, the supplier commits
			 themselves to days rather than times. The supplier typically stores the
			 committed and planned quantities as a <Link href="/baanerp/td/glossary/glossary#SalesSchedu_td" role="glossary">sales schedule</Link> in their ERP system.</Paragraph>
            <Paragraph>The supplier notifies the customer of the quantities they
			 can commit themselves to. If the supplier cannot commit themselves to all
			 requested quantities, the customer can look for other or additional suppliers,
			 or alternative items.</Paragraph>
         </Step>
         <Step ID="Suppl_planning_by_cust_step3_calloff_by_cust">
            <StepTitle>Customer sends call-off</StepTitle>
            <Paragraph>In the purchase schedule, the customer enters a call-off
			 against the committed quantities. In this scenario, replenishment of the
			 component stock is triggered by purchase schedules or purchase orders and
			 EDI/Rosettanet messages.</Paragraph>
         </Step>
         <Step ID="Planning_by_cust_step4_supp_replenishes_cust_stock">
            <StepTitle>Supplier replenishes the customer's stock</StepTitle>
            <Paragraph>The supplier replenishes the <Link href="/baanerp/wh/glossary/glossary#000471" role="glossary">VMI warehouse</Link> as required.</Paragraph>
            <Paragraph>Because the supplier manages the VMI warehouse, the receipts
			 are registered in their ERP system. To notify the customer of the receipts, the
			 supplier sends RosettaNet-XML message Inventory Report to the customer. This
			 message triggers an auto receipt in the customer's <Link href="/baanerp/wh/glossary/glossary#000467" role="glossary">administrative warehouse</Link>. For more information, refer to <Link href="/baanerp/wh/onlinemanual/000480" role="manual">Automatic receipts</Link>.</Paragraph>
            <Paragraph>Other means of communication are also used, in which case
			 the customer manually enters the receipt in their administrative warehouse. The
			 received quantities are inserted in the customer's purchase schedule for each
			 supplier.</Paragraph>
            <Paragraph>If the ownership change rule is <Link href="/baanerp/wh/glossary/glossary#000466" role="glossary">consigned</Link>, the customer becomes the owner when the items
			 are issued for consumption.</Paragraph>
         </Step>
      </Steps>
   </ProcedureSection>
   <GeneralSection>
      <ProcedureList>
         <ListIntro>The remaining steps are identical to the following steps in
		  the full VMI scenario:</ListIntro>
         <ListItem>
            <Link href="/baanerp/wh/onlinemanual/000463#fullVMI_step4_issue_by_supp_for_consumption"
                  role="manual"
                  Update="No">Supplier issues stock for customer</Link>.</ListItem>
         <ListItem>
            <Link href="/baanerp/wh/onlinemanual/000463#fullVMI_step5_invoicing" role="manual"
                  Update="No">Invoicing</Link>.</ListItem>
         <ListItem>
            <Link href="/baanerp/wh/onlinemanual/000463#fullVMI_step5_payment" role="manual"
                  Update="No">Payment</Link>.</ListItem>
      </ProcedureList>
   </GeneralSection>
   <RelatedTopics>
      <SectionTitle>Related topics</SectionTitle>
      <RelTopic>
         <Link href="/baanerp/wh/onlinemanual/000463" role="manual">Full VMI</Link>
      </RelTopic>
      <RelTopic>
         <Link href="/baanerp/tc/onlinemanual/000500" role="manual">Overview of terms and conditions</Link>
      </RelTopic>
      <RelTopic>
         <Link href="/baanerp/wh/onlinemanual/000462" role="manual">Overview of VMI business scenarios</Link>
      </RelTopic>
      <RelTopic>
         <Link href="/baanerp/wh/onlinemanual/000461" role="manual">Inventory ownership in Warehouse Management</Link>
      </RelTopic>
   </RelatedTopics>
</ManualTopic>