Demand

Customers of your supply chain order products in accordance with their demand. In the Demand table you define the mechanism of how the customer's demand for the product is formed.

Column

Description

Customer

Defines the customer. 

Double-click the cell and choose the required customer from the list (it lists all customers defined in the Customers table).

Product

Defines the product for which the demand is specified. 

Double-click the cell and choose the required product from the list (it lists all products defined in the Products table).

Demand Type

Type of demand definition:

  • Periodic demand - select this option if the demand is of repetitive nature: a certain volume of products is ordered during a certain period of time. You can define volume and period values in the Parameters column.
  • Historic demand - select this option if you have the exact demand data (this could be order records from CRM). Define the data in the Parameters column.

Double-click the cell and choose the required demand type from the drop-down list.

Parameters

Defines the demand data. For more flexibility, you can set these parameters to be of stochastic nature. In this case, they will vary in accordance with the certain probability distribution.

Periodic demand parameters:
  • Order interval - defines the time period during which the specified Quantity of product units is ordered.
  • Quantity - defines the quantity of the product units that is ordered at every given Order interval.
Historic demand parameters:
  • Date - the date the demanded quantity refers to.
  • Quantity - the value displayed in the Parameters cell is Total Q, which represents the summarized quantity of the demanded product. The demand value is based on the individual product demand entries that are taken from the Historic demand sheet of the scenario template

Learn how to define demand parameters.

Time Period

Defines the period of time (previously defined in the Periods table) for the demand specified in Parameters. Double-click the cell to choose among the available periods.

Revenue

[Available in NO and SIM scenario type] 

Allows you to set selling price for product. It might be as well used for selling the same product for a different price to a certain customer. 

Down Penalty

[Available in NO scenario type] 

Defines the penalty to be paid per product item for violating the specified demand Quantity (defined in the Parameters column).

e.g. The demanded Quantity is set to 50Down Penalty is set to 1000. If the delivered quantity is 40. the Down Penalty must be paid per lacking product item. It is calculated as 1000 * ( 50 - 40 ) = 10000.

Up Penalty

[Available in NO scenario type] 

Defines the penalty to be paid per product item for violating the specified demand Quantity (defined in the Parameters column).

e.g. The demanded Quantity is set to 50, Up Penalty is set to 1000. If the delivered quantity is 60. the Up Penalty must be paid per extra product item. It is calculated as 1000 * ( 60 - 50 ) = 10000.

Expected Lead Time

[Available in SIM scenario type] 

Defines the time period (in time units specified in the Time Unit column) within which the ordered product is expected to be received by the customer. The value is used to calculate the service level statistics.

Time Unit

[Available in SIM scenario type] 

Specify the time unit that the Expected Lead Time is expressed in.

Note: The list of available units comprises the units defined in the ALX Preferences.

Backorder Policy

[Available in SIM scenario type] 

Defines the backorder policy for the selected product and customer. Backorder policy defines how the order is handled in case the required number of products is not yet available for shipping. There are two alternative options:

  • Not Allowed - the order is cancelled and no products are shipped. The number of cancelled orders is added to the Dropped orders (for sites) and Lost orders (for customers) statistics respectively.
  • Allowed Total - the order is pending until the required number of products is available for shipping.


 

Related topics

Expanding table records

Defining demand parameters

Editing fixed or stochastic numerical data