Automatic Purchasing - Stock Replenishment

To access this system open a purchase order and from the menu select Tools|Automatic Orders (Stock Replenishment).

The automatic purchasing system allows you to automatically (but also selectively) re-order stock based on "ideal" stock holding levels.

The ideal stock level is determined by considering:

the quantity on hand
the quantity on back order
the reorder and overstock levels
the stock already on order

the quantity already in production*

for each individual stock item.

The quantity in production only applies to the Enterprise version of CAPITAL Office, if the Assembly Management System is being used.

CAPITAL will generate a series of purchase orders which you may optionally amend or skip over based on CAPITAL's calculation of your requirements.

When running automatic purchase orders remember that stock that has not been assigned a supplier code will not be ordered. If multi-locations is being used, stock items must be assigned to locations.

When this operation is run, all factors relating to stock requirements that the system is aware of, will be taken into consideration. So there is generally no need to run any other type of automatic ordering if you are using this facility.

All Products

Select to order all products that require replenishment.

Stock Groups

Select to order only those products assigned to marked (ticked) stock groups. Press the Stock Groups button in order to mark or unmark groups.

Supplier Groups

Select to order by marked suppliers. Press the Supplier Groups button in order to mark or unmark supplier groups.

If a stock item's stock group is ticked and you are generating purchase orders by stock group, its supplier group does not also have to be ticked. The reverse also applies. If you are generating purchase orders by supplier group, it does not matter whether the item's stock group has been ticked.

Ordering by supplier group is significantly more efficient, hence faster, than ordering in other sequences.

Location

The department, store, warehouse, etc., you wish to order for. Only applicable if you are using multi-locations.

You may only order by one location at a time and you must always specify a location. The location you specify must match a supplier account that has been set to account type Internal.

Exclude Stock On Hold

Tick to avoid ordering stock placed on hold. (This is the default selection.)

Ignore Reorder Level

CAPITAL will only orders stock that is required to meet current back order requirements (definite orders) until the stock in (holding stock) level goes below the reorder level. You can tick this option in order to ignore the reorder level. CAPITAL will then always order the stock required to meet the ideal stock holding quantity, each time the Automatic Purchase Ordering System is run.

If you will be running the Automatic Purchase Ordering System regularly (for example, every few days) then it is recommended that you leave the Ignore Reorder Level unticked. This will ensure that stock is topped up in reasonable quantity units as required, each time automatic ordering occurs.

If you intend to produce purchase orders periodically: for example, raise a purchase order for a supplier every 30 days or more, then the system will not have the opportunity to raise additional orders to "top up" stock levels as they decline. In this case you may wish to tick this option. This will ensure that the system will order the ideal requirement for holding stock, each time a purchase order is created. The "ideal" requirement is the maximum stock level you wish to carry at any given time.

Manual Purchase Check

Tick to allow inspection of each purchase order before creating it. This will give you the opportunity to amend the order if you wish.

From Class

Leave blank to include all items or specify a starting class code here.

To Class

Leave blank to include all items or specify an ending class code here.

For more information on class analysis consult the topic: ABC Stock Analysis.

How Automatic Ordering Works

CAPITAL determines what to order based on a simple formula. Firstly it looks at the Stock In (physical holding level) and adds this quantity to the On Order quantity. If this quantity cannot meet what is on back order, the requirement is ordered. It then looks at the Reorder Level and the Overstock Level and if necessary, orders additional stock to meet the ideal hold level.

Purchase Conversions & Kits

If you will be ordering from back orders and using purchase order conversions, CAPITAL will attempt to order the exact quantity required. You may wish to amend the purchase order to reflect a larger quantity, particularly if your supplier will not accept orders representing fractions of box units. When ordering from the stock file, CAPITAL will order the closest whole box quantity required to meet the order.

Keep in mind that the On Order and Overstock levels of kits take precedence over the On Order and Overstock levels of individual components. For example, if you wish to keep five of product ABC in stock, but product ABC is also part of a kit, which requires 10 of ABC to be in stock to fill the stock kit requirement, CAPITAL will order 10 of ABC. It will not order 5 + 10 of product ABC.

Assign all your stock kits to a single stock group or set of "kit groups". Then order your kits before you request the ordering of individual components.

Cancelling Automatic Ordering

The automatic purchase order process is cancelled when you leave the purchase order area, when you go to edit it another purchase order or when you select Tools|Automatic Orders (Stock Replenishment or Pending Back Orders) while already in automatic ordering mode.

Automatic Ordering Check List

If you can't get the Automatic Purchase Ordering System to order the stock you require then check the following:

1. Have you ticked (marked) the applicable stock or supplier groups?

2. If you are running multi-location stock control, have you selected the right location for ordering to occur?

3. Have you assigned a valid supplier code to your stock items?

4. Is the stock item on hold?

5. Has the stock item already been placed on order and is therefore not being ordered again?

6. If the stock item is on Back Order Hold, then it will not be included in the reorder calculation. Is the item on back order hold?

Hints & Tips

From the Tools menu select Skip To Next Order if you want to skip over a particular purchase order. You will be presented with the purchase order again if you re-run the automatic ordering utility.
INSTALLATION Workshop settings can affect stock replenishment calculations. Consult the topic: Stock Control General Options for more information.

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