Understanding Production by Lot Size: A Look at Strategy 30 in SAP PP

In SAP Production Planning (PP), the proper planning strategy is crucial for efficient inventory management and production scheduling. Strategy 30, also known as “Production by Lot Size,” is a popular choice for companies that produce for stock (MTS) but also cater to specific customer demands.

What is Strategy 30?

Strategy 30 leverages a lot-sizing procedure defined in the material master record to group procurement quantities. This means the system considers Planned Independent Requirements (PIRs) and individual sales orders during the Material Requirements Planning (MRP) run.

Critical features of Strategy 30:

• Flexibility: You can plan and produce based on forecasts (PIRs) and actual customer needs (sales orders).
• Lot Sizing: Production happens in defined lots, optimizing inventory levels and production efficiency.
• Independent Planning: Sales orders don’t consume PIRs, allowing parallel planning for stock and specific customer requirements.

Who should use Strategy 30?

This strategy is ideal for companies that:

• Manufacture for stock but also fulfill individual customer orders.
• Have a mix of high-demand and low-demand products.
• Work in contract-based industries, like supplying spare parts.

Benefits of Strategy 30:

• Improved Inventory Management: By grouping demands into lots, you can optimize stock levels and reduce carrying costs.
• Enhanced Production Efficiency: Defined lot sizes allow for better planning of resources and production runs.
• Flexibility to Customer Needs: The ability to react to specific sales orders alongside forecast-based production provides excellent responsiveness.

Things to Consider with Strategy 30:

• Lot-Sizing Expertise: Defining an effective lot-sizing procedure is crucial for maximizing the benefits of Strategy 30.
• Increased Planning Complexity: Considering PIRs and sales orders can add complexity to the planning process.
• Potential for Overproduction: Lot sizing can sometimes produce more than actual customer demand.

In conclusion, Strategy 30 offers a versatile approach to production planning in SAP PP. By understanding its features and considerations, you can determine if it aligns with your company’s production needs and helps achieve optimal inventory management and production efficiency.