Inventory Attributes

Inventory is only available in the Tactical Planning Module.

Minimum Inventory Cover and Maximum Inventory Cover

Sheets on which it appears

Possible inputs

Any number greater than or equal to 0

How it affects the model

The number of next periods that throughput (outbound) covers. The attributes “Minimum Inventory Cover” and “Maximum Inventory Cover” describe the fraction of the next periods throughput (outbound) that must be or can be held as inventory. Minimum Inventory Cover is handled as a minimum capacity constraint but it is not replacing minimum capacity for inventory or the target inventory, it is just an addition. For example, if a warehouse has Inventory Cover (2) in period_1 and in period_2 that means that period_1 inventory should cover period_2’s and period_3’s outbound volume. If the outbound of period_2 and period_3 is 2, then the inventory should be greater than 2+2=4. If the planning horizon ends at period_3, then the inventory of period_2 will be twice the outbound of period_3. (Assuming that the next periods are behaving similarly to the last one.) We can distinguish four different cases in the calculation:

We can distinguish four different cases in the calculation, described with Minimum Inventory Cover:

Multi period model and the inventory cover is greater than 1:

Inventory coverage coefficients:

Product	Warehouse	Period	Minimum Inventory Cover	April	May	June
Carrot	Warehouse_1	March	2	1	1	0
Carrot	Warehouse_1	April	1.5		1	0.5
Carrot	Warehouse_1	May	3			3
Carrot	Warehouse_1	June	2			2

With these inventory volumes will look the following:

Product	Warehouse	Period	Minimum Inventory Cover	Volume	Closing Inventory
Carrot	Warehouse_1	March	2	10	(120)+(130)=50
Carrot	Warehouse_1	April	1.5	20	(130)+(0.540)=50
Carrot	Warehouse_1	May	3	30	(3*40)=80
Carrot	Warehouse_1	June	2	40	(2*40)=80

When there is Inventory Cover specified for the last period (June) or the inventory coverage of previous periods’ number goes beyond the horizon (May) the closing inventory is calculated based on the last period’s outbound (40).

Multi period model and the inventory cover is less than 1:

Inventory coverage coefficient will apply only to the next period and will have the same value as the Inventory coverage.

Inventory volumes will look the following:

Product	Warehouse	Period	Minimum Inventory Cover	Volume	Closing Inventory
Carrot	Warehouse_1	March	0.5	10	0.5*20=10
Carrot	Warehouse_1	April	0.5	20	0.5*30=15
Carrot	Warehouse_1	May	0.5	30	0.5*30=15

When there is Minimum Inventory Cover specified for the last period (May) the closing inventory is calculated based on the last period’s outbound (30).

Single period model and the inventory cover is greater than 1:

Inventory coverage coefficient will apply only to the single period and will have the same value as the Inventory coverage.

Inventory volumes will look the following:

Product	Warehouse	Period	Minimum Inventory Cover	Volume	Closing Inventory
Carrot	Warehouse_1	2023	2	10	2*10=20

When there is Minimum Inventory Cover specified in a single period model the closing inventory is calculated based on the current period’s (2023) outbound (10).

Single period model and the inventory cover is less than 1:

Inventory coverage coefficient will apply only to the single period and will have the same value as the Inventory coverage.

Inventory volumes will look the following:

Product	Warehouse	Period	Minimum Inventory Cover	Volume	Closing Inventory
Carrot	Warehouse_1	2023	0.5	10	0.5*10=5

When there is Minimum Inventory Cover specified in a single period model the closing inventory is calculated based on the current period’s (2023) outbound (10).

Maximum Inventory Cover is calculated in the same way as Minimum Inventory Cover in each case, but acts as a maximum capacity constraint for Warehouse Inventory.

Product	Warehouse	Period	Maximum Inventory Cover	Outbound volume	Max Capacity	Closing Inventory
Carrot	Warehouse_1	March	2	10	30	20 (Max. Capacity > Maximum Inventory Cover)
Carrot	Warehouse_1	April	2	10	10	10 (Max. Capacity < Maximum Inventory Cover)
Carrot	Warehouse_1	May	0.5	20	10	10 (Max. Capacity = Maximum Inventory Cover)

In every case the Minimum Inventory Cover acts in addition to minimum constraints. So, if there is also a Minimum Capacity specified, both Minimum Inventory Cover and Minimum Capacity will apply . The value for Closing Inventory depends on which of these two is higher.

Product	Warehouse	Minimum Inventory Cover	Outbound volume	Min Capacity	Closing Inventory
Carrot	Warehouse_1	2	10	30	30 (Min. Capacity > Minimum Inventory Cover)
Carrot	Warehouse_1	2	10	10	20 (Min. Capacity < Minimum Inventory Cover)
Carrot	Warehouse_1	0.5	20	10	10 (Min. Capacity = Minimum Inventory Cover)

In every case the Maximum Inventory Cover acts in addition to maximum constraints. So, if there is also a Maximum Capacity specified, both Maximum Inventory Cover and Maximum Capacity will apply . The value for Closing Inventory depends on which of these two is lower.

Product	Warehouse	Maximum Inventory Cover	Outbound volume	Max Capacity	Closing Inventory
Carrot	Warehouse_1	2	10	30	20 (Max. Capacity > Maximum Inventory Cover)
Carrot	Warehouse_1	2	10	10	10 (Max. Capacity < Maximum Inventory Cover)
Carrot	Warehouse_1	0.5	20	10	10 (Max. Capacity = Maximum Inventory Cover)

Minimum Inventory Cover and Maximum Inventory Cover are defined stepwise, and the Warehouse (Product) steps and the Inventory (Product) steps are independent.

Product	Warehouse	Step	Maximum Inventory Cover	Outbound volume
Carrot	Warehouse_1	1	2	10
Carrot	Warehouse_1	2	0.5	5

In this case the Closing Inventory will be 2*10 + 0.5*5 = 22.5, and this volume is allocated to Warehouse (Product) capacities according to the steps applied there.

Target (Inventory)

Sheets on which it appears: Inventory, Inventory Product
Possible inputs: Any number greater than or equal to 0
How it affects the model: The target value of the inventory in a period. If the inventory is below or above the target inventory, the target is violated, and Target Violation cost should be taken into account. The total target violation cost depends on how much of the inventory is under or over the target (see below). The target inventory does not replace the minimum or maximum capacity constraints, but target inventory should be greater than the minimum capacity and should be less than the maximum capacity.

Target Violation Cost (Inventory)

Sheets on which it appears

Inventory, Inventory Product

Possible inputs

Any number greater than or equal to 0

How it affects the model

The cost of inventory target violation for a warehouse during a period. If the inventory is below or above the target inventory, the target is violated, and Target Violation cost should be taken into account. The total target violation cost depends on how much of the inventory is under or over the target:

Warehouse	Period	Target Inventory	Target Violation Cost	Closing Inventory	Total target violation cost
Warehouse	Period	Target Inventory	Target Violation Cost	Closing Inventory	Total target violation cost
Warehouse_1	Period_1	12	2	10	(12-10)*2=4
Warehouse_1	Period_1	12	2	12	(12-12)*2=0
Warehouse_1	Period_1	12	2	16	(16-12)*2=8

The target inventory does not replace the minimum or maximum capacity constraints, but target inventory should be greater than the minimum capacity and should be less than the maximum capacity.

Opening Inventory

Sheets on which it appears: Inventory Product
Possible inputs: Any number greater than or equal to 0 (it should be defined for the first period and for the first step).
How it affects the model: The inventory level at the start of the first period.

Note

Notice of behavior change: In SC Navigator 25.15.4 and earlier, if your input data included both ‘Opening Inventory’ and ‘Force Close (Inventory)’, the model ignored the Opening Inventory. In more recent versions, the model now includes the ‘Opening Inventory’. This means all ‘Opening Inventory’ will move out of the warehouse to the appropriate destination instead of being ignored.