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Forecast Consumption in Dynamics AX

Systems for producing items to stock often use the higher of the forecast quantity or actual demand quantity when creating suggested schedules.

Many companies that produce a demand forecast for planning require that forecast be consumed by actual demands—otherwise, overproduction or purchasing can occur. Forecast consumption functionality is available within Dynamics AX 2012, but there are some setups required.

This is the initial setup for planning without the use of forecast consumption.

The item in this example has a coverage group that uses a coverage code of period; the periods are seven days.

This is the initial setup of the coverage group.

A demand forecast has been created for the item as a monthly forecast.

Actual demand has been created in the form of sales.

After running MRP using this setup, the following results were calculated.

As you can see, no forecast consumption has taken place. The forecast and sales have been added together to create a total demand and planned purchase orders have been identified to fulfill that demand.

To use forecast consumption, a reduction key needs to be created. This reduction usually copies the period of the forecast; in this example, the period is monthly.

The percentage values in the reduction key are set to zero.

The reduction key now needs to be added to the coverage group.

Now we can run the MRP again.

As you can see, the forecast has been reduced by the actual demands.

For more information about forecast consumption, contact BKD’s Microsoft Dynamics AX support center.

This post was written by:

Adrian has more than 19 years of experience performing system selections, implementations and training for financial and customer relationship management applications. He previously worked in the private sector leading significant development projects, managing multisite data centers and overseeing departmental budget development and management.

2 Responses to “Forecast Consumption in Dynamics AX”

  1. avatar JF says:

    Hi, thanks for this detailed guide. 1 question though: let’s say your forecasts for the month of March have not been fully consumed, do you have any way to postpone the remaining quantity in April ? What I observed is that when system date > forecast date, the forecast disappear. To avoid that, I put the forecast on the last day of the month with a monthly reduction key as described in your article, but at would like to be able to carry forward the remaining quantity of the forecast, if any. Do you have any thought about that ?

    Cheers
    JF

    • avatar Adrian Young says:

      Forecasts are not typically carried over. The reason for using a forecast is to plan a supply for potential sales within a given period. The supply in the form of a purchase order or a production order should have been created to match the forecast. When the sales order gets created it consumes the forecast and matched against the supply created form the initial forecast, the balance of the supply is still there waiting for another sales order. If no sales order comes in then the balance will be treated as QOH or a planned receipt for the next planning period. With this, the forecasted supply is carried over to the next period.

      You may also want to look at using monthly minimum inventory levels to get demands in the system.

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