11/22/24, 11:06 PM Automatic Reorder Point (MRP Type: V2 or VM) Plann...

- SAP Community
m
m
Products and Technology Groups Partners Topics Events What's New Get Started Explore SAP
u
ni
t
y
SAP Community  Products and Technology  Enterprise Resource Planning  ERP Blogs by Members  Automatic Reorder Point (MRP Type: V2 or VM) Plann...

Enterprise Resource Planning Blogs by Members

Gain new perspectives and knowledge about enterprise resource planning in blog posts from community members. Share your own comments and ERP insights
today!

Blog  What are you looking for today?

Automatic Reorder Point (MRP Type: V2 or VM) Planning - Part Labels In This Area
1
"Best Practice" 1 "mm02" 1

$session in CDS 1 *SAP" 1

RaviDave 
‎2023 Feb 15 3:56 AM - SAP 1 2023 Upgrade 1
Active Participant
@expertsap 2 @sapcommunity 1

 14 Kudos  19,771 A_PurchaseOrderItem additional… 1

ABAP 5 abap cds 1

SAP Managed Tags: MAN Material Requirements Planning, MM Purchasing
ABAP CDS VIEW 2

Introduction: In this blog, I will explain how Automatic reorder point planning works ABAP CDS Views 2
and how the system calculates automatic reorder points. In other words, the formula
ABAP CDS Views - BW Extraction 1
behind it.
ABAP CDS Views - CDC (Change… 2

ABAP DDIC CDS view 1

Note: Because of content, I will divide this blog into 2 parts.
https://community.sap.com/t5/enterprise-resource-planning-blogs-by-members/automatic-reorder-point-mrp-type-v2-or-vm-planning-part-1/ba-p/13569776 1/12
11/22/24, 11:06 PM Automatic Reorder Point (MRP Type: V2 or VM) Plann... - SAP Community

ABAP Development 2

ABAP Extensibility 1

ABAP Programming 1 abapGit 1

Part 1: Covers consumption-based planning when to use it, and what's the
ACCOSTRATE 1 ACDOCP 1
formula for automatic reorder point calculation.
Adding your country in SPRO -… 1
Part 2: How to carry out automatic reorder point planning within the material Adobe form binding 1
master. Explanation of formula in Excel. Automatic Reorder Point (MRP Type:
Adobe forms 1 Adobe Printing 1
V2 or VM) Planning – Part 2
Advance Return Management 1

Advanced Intercompany Sales… 1

Advanced SAP Techniques 1

This blog is prepared about S/4 HANA and MRP Live.
ADVANCED VARIANT… 1

AgenticAI 1

The function of MRP: Material Requirements Planning's (MRP) main job is to keep AI and RPA in SAP Upgrades 1
track of stocks and, in particular, to automatically create purchase proposals for
API and Integration 1
buying and making things.
Application Development for SAP… 1

Approval Workflows 1 Ariba 1

Results of an MRP Run: The possible procurement proposals that can be created by ARM 1 Artificial Intelligence (AI) 1
the automatic planning run are:
ASN 1 Asset Management 1

Asset under construction 1

Assigned budget 1

Planned orders (For procurement type: E or X) Associations in CDS 1

https://community.sap.com/t5/enterprise-resource-planning-blogs-by-members/automatic-reorder-point-mrp-type-v2-or-vm-planning-part-1/ba-p/13569776 2/12
11/22/24, 11:06 PM Automatic Reorder Point (MRP Type: V2 or VM) Plann... - SAP Community

Associations in CDS Views 2

Purchase requisitions (For procurement type: F)
Attachment List 1 auditlog 1

Scheduling agreement delivery schedule lines (For procurement type: F) authorization 1

Auto PO from GR 1

Availability date 1

Azure Center for SAP Solutions 1

Consumption-Based Planning: Consumption-based MRP procedures use material
AzureSentinel 2 BADI 1
prediction or static MRP procedures to figure out what materials will be needed in the
future based on how much was used in the past. MRP processes based on Bank 1 BAPI_PO_CREATE1 1
consumption have nothing to do with the master plan. So, an independent or
BAPI_SALESORDER_CREATEFR… 1
dependent requirement does not make the net requirements estimate happen.
Instead, the net requirements calculation is done when a stock level goes below a batch characteristics 1
reorder point or when forecasted needs are calculated from consumption data from Batch Classification 1
the past. Consumption-based planning processes are easy to use and don't take
much work to put into place. batch Determination 1

Batch Management 1

Best Practice 1 Billing 1

BRF+ 1 BRFPLUS 1

Budget for PRs 1

Bundled Cloud Services 1

business participation 1

Business Partner Master Data 1

Business Processes 2

Business Trends 1

https://community.sap.com/t5/enterprise-resource-planning-blogs-by-members/automatic-reorder-point-mrp-type-v2-or-vm-planning-part-1/ba-p/13569776 3/12
11/22/24, 11:06 PM Automatic Reorder Point (MRP Type: V2 or VM) Plann... - SAP Community

Business Trends 1

Capacity Planning 1 CAPM 1

Carbon 1 CDS Annotations 2

CDS View with Parameter 2

Cental Finance 1

Central finance 1 CFIN 2

CFIN Document Splitting 1

Charge calculation 1

Classical MRP 1 Cloud ALM 1

Cloud Integration 1

COGS SPLIT 1

Commitment Cost 1

MRP Procedures Commitments by Cost Center 1

condition contract management 1

When to use CBP (Recommendation): It is suggested that these methods be used
Condition Records 1
for B and C materials, which are low-value materials whose usage doesn't change
much. Condition technique 1

Connection - The default… 1

Consignment Process using MRP… 1

Controlling 1 Conversion 1

CONVERSITON ECC TO S4HANA 1

COPA 1 Copy Control 1

https://community.sap.com/t5/enterprise-resource-planning-blogs-by-members/automatic-reorder-point-mrp-type-v2-or-vm-planning-part-1/ba-p/13569776 4/12
11/22/24, 11:06 PM Automatic Reorder Point (MRP Type: V2 or VM) Plann... - SAP Community

Copy Inspection Results 1

cost distribution TM 1

Cost plan 1 CPI 1

Related Content
Consumption-Based Planning Recommendation Financial Accounting for
Intercompany Dual Service Order
In consumption-based planning, there are many MRP methods (called "MRP Types"),
Scenario in SAP S/4HANA 
in Enterprise Resource Planning Blogs by
but this blog will focus on automatic reorder-based planning (MRP type: V2 or VM). SAP Tuesday

Within Automatic reorder point planning, we have 2 MRP types available: 2024 SAP BTP Year in Review:
Release Highlights for SAP S/4HANA
users 
in Enterprise Resource Planning Blogs by
1. MRP Type VM: Automatic reorder point planning SAP Monday

2. MRP Type V2: Automatic reorder point with external requirements. Why should we consider Rule based
consolidation of Investments vs
Activity based in Group Reporting 
in Enterprise Resource Planning Blogs by
SAP a week ago
"Including external requirements" is what makes them different. What are needs from
the outside? Automatic assignment of decimals
zeros for specific fields in QM -

As shown below, MRP type: VM will count sales orders and reservations as extra
Inspection plan Migration Object 
in Enterprise Resource Planning Q&A 2
demand on top of the restart point. "Include ext. reqmt" is a field in the MRP-type weeks ago
configuration that controls the following numbers and system behavior:
Artificial Intelligence and other
Innovations in SAP S/4HANA Cloud
https://community.sap.com/t5/enterprise-resource-planning-blogs-by-members/automatic-reorder-point-mrp-type-v2-or-vm-planning-part-1/ba-p/13569776 5/12
11/22/24, 11:06 PM Automatic Reorder Point (MRP Type: V2 or VM) Plann... - SAP Community

Private Edition 2023 FPS02 

Blank: No external requirements are taken into consideration in Enterprise Resource Planning Blogs by
SAP 3 weeks ago

1: All of the horizon considers external needs like sales orders and reservations.

2: Only external needs, like sales orders and reservations, are taken into
Popular Blog Posts
account during the lead time for replenishment.

IDoc Basics For Functional

Consultants

former_member213836
Active Participant

 1066773  320  675

With External Requirements LSMW for Functional Consultants in

https://community.sap.com/t5/enterprise-resource-planning-blogs-by-members/automatic-reorder-point-mrp-type-v2-or-vm-planning-part-1/ba-p/13569776 6/12
11/22/24, 11:06 PM Automatic Reorder Point (MRP Type: V2 or VM) Plann... - SAP Community

simple step-by-step way

Automatic Reorder Point Calculation and Formula:
former_member182098
Active Contributor

Automatic reorder point = safety stock + daily requirement * replenishment lead  629832  295  391
time

As shown above, the Automatic reorder point includes safety stock; below is a
formula for safety stock.

Pricing procedure Steps and Details

Safety Stock = R * square root of W * MAD in SAP MM

former_member183424
Active Contributor

R = R Means Service Level Factor. The MRP-2 service level has an equal  762633  161  325
factor. The next number shows that 50% of customer needs can be met
without safety stock. It also shows how hard it is to meet customers'
needs 100% of the time. Factor R shows how the accuracy of the
prediction relates to the service level (SL).
Top Kudoed Authors

Dmitry_Kuznetsov  12

satinder_singh  6

https://community.sap.com/t5/enterprise-resource-planning-blogs-by-members/automatic-reorder-point-mrp-type-v2-or-vm-planning-part-1/ba-p/13569776 7/12
11/22/24, 11:06 PM Automatic Reorder Point (MRP Type: V2 or VM) Plann... - SAP Community

Leelamohan  5

PriyaRatan  2

nick_ivanovic  2

Bohdan  2

DanielleLarocca  2

SL(%) and Factor R

former_member20
8398  2

W = Delivery Times in Days / Forecast Period in Days

VKR_23  2

If the material is produced in-house, the delivery time is opening period +

in-house production time + goods receipt processing time. It is expressed
Vivek03  1
in workdays. The forecast period is taken from the material master record
and expressed in workdays. View all

https://community.sap.com/t5/enterprise-resource-planning-blogs-by-members/automatic-reorder-point-mrp-type-v2-or-vm-planning-part-1/ba-p/13569776 8/12
11/22/24, 11:06 PM Automatic Reorder Point (MRP Type: V2 or VM) Plann... - SAP Community

If the material is procured externally, the delivery time is goods receipt

processing time + planned delivery time. It is expressed in calendar days.
The forecast period is taken from the material master record and
expressed in calendar days.

MAD = Stands for Mean Absolute Deviation (MAD) measures the

accuracy of the forecast by averaging the alleged error. The system uses
the original forecast and Ex-Forecast to identify the difference/accuracy of
the forecast, and the average absolute difference is MAD. I will explain
this with an example (please check part 2).

Note: You can specify a minimum safety stock. If the result of the safety stock
calculation is lower than this limit, the safety stock is then automatically set to this
minimum value. You enter the minimum safety stock in the material master record
(the MRP 2 screen)

Part 2: How to carry out automatic reorder point planning within the material master.
Explanation of formulas in Excel. Automatic Reorder Point (MRP Type: V2 or VM)
Planning - Part 2

If you find my blog useful, please like and share your feedback in the
comments below and follow me for more content like the above.

Please follow my profile for future posts (ravidave2)

https://community.sap.com/t5/enterprise-resource-planning-blogs-by-members/automatic-reorder-point-mrp-type-v2-or-vm-planning-part-1/ba-p/13569776 9/12
11/22/24, 11:06 PM Automatic Reorder Point (MRP Type: V2 or VM) Plann... - SAP Community

Topic Page (find the most relevant one – https://community.sap.com/topics/)

Ask questions about MM (Materials Management) and follow (

https://answers.sap.com/tags/477297786799213261950044802925335)

Read other MM (Materials Management) blog posts and follow (

https://blogs.sap.com/tags/477297786799213261950044802925335/)

Tags:

automatic reorder point based planning consumption based planning

3 Comments

dankanv45 
Explorer ‎2023 Oct 17 2:05 AM

https://community.sap.com/t5/enterprise-resource-planning-blogs-by-members/automatic-reorder-point-mrp-type-v2-or-vm-planning-part-1/ba-p/13569776 10/12
11/22/24, 11:06 PM Automatic Reorder Point (MRP Type: V2 or VM) Plann... - SAP Community

 1 Kudo

Graph and diagram helps to understand this better and we were able to implement it
very quickly with the help of this blog

andrewd179 
Explorer ‎2023 Oct 17 5:27 PM

 1 Kudo

Finally, found a blog that completed our client requirement.

loumui 
Explorer ‎2023 Oct 17 8:37 PM

 0 Kudos

Good blog on MRP

https://community.sap.com/t5/enterprise-resource-planning-blogs-by-members/automatic-reorder-point-mrp-type-v2-or-vm-planning-part-1/ba-p/13569776 11/12
11/22/24, 11:06 PM Automatic Reorder Point (MRP Type: V2 or VM) Plann... - SAP Community

 You must be a registered user to add a comment. If you've already registered,

sign in. Otherwise, register and sign in.

Comment

Privacy Terms of Use

Copyright Legal Disclosure

Trademark Support

Cookie Preferences
Follow

https://community.sap.com/t5/enterprise-resource-planning-blogs-by-members/automatic-reorder-point-mrp-type-v2-or-vm-planning-part-1/ba-p/13569776 12/12