Overview
AGR’s suggested quantity is calculated using an order formula based on several key factors.
However, there might be instances where the suggested quantity differs from your expectations. In this article, we’ll detail what actions you can take to finetune AGR’s order proposal.
Making informed adjustments to the data points behind AGR’s order proposals will allow you to spend considerably less time reviewing order lines and aligning the suggested quantities with your business needs.
Calculated Quantity
Calculated quantity = Demand for the Order Period + Safety Stock + Min stock – Stock on hand – Undelivered orders
If the calculated quantity is higher or lower than expected, examining the order’s result breakdown in the sidebar will help you identify which data points may need adjustment:
Order Period
The timeframe the order is meant to cover - influences both Demand and Safety Stock. See the different ways to set it up here.
Demand
Demand for order period = forecasted demand or sales plan + open sales orders + min stock (optional) + upcoming promotions (if planned)
In cases you believe the demand for a specific item is incorrect, consider these options:
1. Change the Order Period
An order period that is too long may lead to excessive demand; the opposite will happen if it’s too short.
If you rely on scheduled orders, consider adjusting the frequency. For instance, switching from a monthly to a bi-weekly schedule will reduce the length of the ordering period.
2. Adjust Sales History or Sales Plan
If there has been a period with exceptionally high or low sales, that will drive AGR’s forecast to suggest higher or lower quantities respectively, since it might be recognizing a pattern. Also, high variations in the sales pattern will lead to an increase in the calculated quantity, through safety stock.
To create a better input to the forecast calculations, pay close attention to any sales spikes or drops.
2.1. Adjust Sales History
To make the sales history more accurate, you can:
Change the first Sale date into Forecast in AGR
Exclude a customer
Override the sales history in the Item Chart or Item Card Grid (Sale data series)
2.2. Adjust Sales Plan
For seasonal items: assign a Forecast Profile if the seasonality hasn't been detected based on the item's sales history
Override future sales in the Item Card Plan(1 item) or Plans (multiple items)
The override will persist until removed. Press backspace + enter to delete the override and restore the original number.
3. Review the Sales Orders global setting
This setting will determine if your sales orders are always, never, or conditionally included in the demand calculation. More information about this is available here.
4. Handle new and slow-moving items
For new items, there may not be sufficient sales history to create a sales forecast. Options:
Use connected items to give the item a more robust sales history from an older item
Override future sales or override the order qty
As sales happen the forecast will pick up.
For slow-moving items: the forecast will be low; for these items, there is often a higher safety stock than the forecast
Adding in a Min stock value could help, especially for retail customers
Consider increasing the order period, as these items may be better suited to buy a few times per year, considering shipping costs vs holding costs.
Keep in mind that AGR’s forecast runs on the 1st day of each month. For example, June’s sales are only considered in July’s forecast.
The extra stock kept to mitigate the risk of stockouts due to demand uncertainty. Acts as a buffer between forecasted and actual demand levels during the order period.
If an item’s safety stock seems too high, you can:
Reduce the Confidence Factor on the item card or in Settings, using the ABC matrix
Reduce the Order Period to cover fewer days of demand (e.g.: scheduled orders: changing from a monthly to a bi-weekly schedule).
Amend Sales value outliers/peaks or exclude them altogether, since an irregular Sales History will call for higher safety stock. This can be done in the Item Card Chart (Sale pencil icon) or Grid.
Suggested Quantity
The Calculated Quantity is always rounded by the Minimum Order Quantity and Order Multiple to determine the Suggested Quantity.
Low calculated quantity, but high suggested quantity
Make sure the MOQs and OMs are correctly populated in your ERP. By default, AGR will always meet the MOQ and then round the quantity up to the next order multiples.
If your MOQ is higher than the calculated quantity, AGR will suggest ordering the MOQ. This can lead to overstocking if the MOQ significantly exceeds your demand for the period.
You can also change the Minimum Order Multiple Threshold in Settings > Order to determine if AGR will round up or down.
For example, MOQ = 20 and OM = 2
AGR Calculated Qty = 22.5
This quantity is between 2 order multiples: 22 and 24. Note that (22.5-22)/2 = 25% of the next order multiple
If MOM threshold = 0% → Suggested Qty = 24 → rounds up to the next OM
If MOM threshold = 30% → Suggested Qty = 22 → doesn’t round up to the next OM
Lastly, you can simply override the order proposal by changing the value in the green Qty cells, and that is the final value that will be sent to your ERP.