The range of coverage profile is an object you configure in SAP-ECC-System. You use it to control the dynamic safety stock for your material. In this article, I’m going to show you how to set up a specific profile.
As described in another article SAP-System offers four basic types of safety stock. One of those types is called dynamic safety stock, as it allows a stock level that changes over time. The calculation to do so is not apparent and is controlled by different parameters. I will explain the range of coverage profile in the following post.
Average Daily Requirements
The basis to figure a range of coverage is the parameter “Daily Requirements”. Within the coverage profile, you specify how many periods are taken into account to calculate the average daily requirement.
- Period Indicator
- Type of Period Length
- Number of periods
You can select between three different options to specify the calendar period you want to use to calculate the average daily requirement. These options are:
- Planning Calendar Periods
Type of Period Length
Using this parameter you determine what days to take into account in the calculation. You can select the following:
- Calendar Days
- Standard Days
Number of Periods
Here you specify the number of periods the calculation of the average daily requirements is based on.
Define the Target
Within the range of coverage profile
- Minimum Range of Coverage
TargetRange of Coverage
- Maximum Range of Coverage
You specify all the three values in days. As well as the “Number of Periods”-Field which
Target Range of Coverage
This value is the important one. You determine how many days the stock should cover in addition to the usual demand. The system multiplies this number of days with the average daily requirements and adds the result to the proposed quantity.
This is what is usually referred to as dynamic safety stock.
Minimum Range of Coverage
If the stock drops under this level, the planning will replenish at least to the target level.
Maximum Range of Coverage
Above the maximum level, the planning run will reduce the quantity proposal of the order or raise an exception.
Evaluating the Range of Coverage Profile
Defining a safety stock with a Range of Coverage is the most dynamic approach SAP ERP offers. With every planning run the level adjusts to changed requirements or reschduled supply. So, you can never forget to reduce the safety stock and end up on a pile of material that no one wants anymore.
The coverage profile works best with demand driven planning.