Distribution orders are used for moving inventory parts between sites. A planned distribution order identifies a need for goods to be moved from one site (the supply site) to another site (the demand site). The part to be moved must have the same inventory part number on both sites. Before a move can be executed, the inventory part on the demand site must be connected to a purchase part and a supplier for purchase part record. The inventory part on the supply site must be connected to a sales part record. When releasing a distribution order, all the required purchase and sales part records that have not been entered yet will be created automatically, based on the inventory part records. The automatically created sales parts and the supplier for purchase parts will be indicated as a Quick Registered Part, so that updating afterwards can be performed easily.
The demand and supply site can belong to the same company or to different companies. Distribution orders cannot be used for moving parts between different databases. Before a site can be entered as a demand site on a distribution order, it has to be entered as an internal customer. A supply site on a distribution order has to be entered as an internal supplier.
If a user is connected to a coordinator, this coordinator will be used by default when new distribution orders are entered. If the user is not connected to a coordinator or if the distribution orders are created automatically, the default coordinator entered in the Supplier for Purchase Part window will be used. If distribution orders are created automatically and a default coordinator is not entered, the value indicated by an asterisk (*) will be used. This value is generated by the system at installation. The distribution order number is retrieved from the Coordinator Group ID, Distribution Order Prefix and Distribution Order No fields.
Sourcing inventory from other sites can use different types of supply orders. It can be either purchase requisitions with purchase orders, supplier schedules, or distribution orders. When working with these internal supply orders, the supply site will be enabled as an internal supplier, and a percentage of the inventory part supply will be acquired. This is set up on the Supplier and Inventory Part windows respectively. To automatically create distribution orders (instead of purchase orders or supplier schedules) the Multi-site Planned Part check box must be selected in Supplier for Purchase Part window. It is only possible to select for internal suppliers. If a Supplier Split has not been set up in the Purchase Part window, only the primary supplier will have automatically created supply orders.
Planned distribution orders are either entered manually, or created automatically by other parts in the system. The following are instances when distribution orders are created automatically:
DOP creates distribution orders as a result of running the Capability Check. Distribution allocations create distribution orders when they are released.
Planned distribution orders can be deleted manually or by using the above planning tools when you need to re-plan the moving of goods.
An advantage with distribution orders compared to purchase orders and supplier schedules is that the demand quantity and the date entered on the demand site will instantly be seen as a supply quantity with a due date on the supply site. This can be achieved without sending orders. However, this requires both the demand site and the supply site to cooperate when working with distribution orders. Clear guidelines on what changes are allowed (e.g. regarding the delivery date or the quantity) on the distribution orders in each status is required.
When a distribution order is released, a released customer order line is created on the supply site and a released purchase order line is created on the demand site. At release, it is possible to specify whether existing customer orders and purchase orders should be used or whether new customer orders and purchase orders should be created by the distribution order release process. The customer orders and purchase orders enable the use of the same reservation, shipment, and receipt processes for the distribution orders as the customer orders and purchase orders respectively. The reservation, shipment, and receipt processes can be reached from the distribution order. Executing the processes are done in the same way, no matter what kind of order is executed.
The exact point at which a distribution order should be released is an important decision that affects the flexibility in planning distribution orders. Usually, the coordinator is responsible to make a balanced decision. Re-planning is easier for planned distribution orders, because they can be manually or automatically deleted. Released distribution orders cannot be deleted (manual change or cancellation is possible). The supply site (having a certain part lead time) needs to have the distribution order released at some point. The number of days before the due date on which the distribution order should be released (i.e. the move becomes definite) depends on the planning environment to which the sites belong. If a general praxis can be settled on the number of days before the due date that should be applied to a selection criteria of distribution orders, the release process can be scheduled to run at regular intervals (e.g. after each scheduled MRP run). The release decision is then no longer taken by a person. Instead it becomes a general praxis performed by the system.
Depending on the order type and the automatic receipt parameter, the distribution order will be executed more or less automatically. The order type controls how the distribution order will be handled at the supply site, and in the reservation, picking, and delivery processes. The automatic receipt parameter defines whether the receipt will be handled manually on the demand site. If the Automatic Receipt feature is used, the distribution order will be instantly received into the proposed location when the distribution order is delivered from the supply site. By using as much automation as possible, the release operation will deliver the distribution orders from the supply site, and receive them into stock on the demand site (the Closed status) with only one user operation.
When distribution orders are created from DOP (as a result of a Capability Check), the distribution orders are released automatically. When distribution orders are created from distribution allocations, depending on the release option selected, the distribution orders will be in status Planned or Released.