Optimizing Inventory Flow: SAP EWM Replenishment P...

SharmaGaurav

In the competitive landscape of supply chain management, effective inventory management is crucial for ensuring that products are available when needed, minimizing stockouts, and maintaining optimal operational efficiency. SAP Extended Warehouse Management (EWM) provides a robust framework for managing inventory replenishment processes, ensuring that stock levels are maintained across various storage locations. This article will explore the EWM replenishment process in detail, outlining its significance, key components, and best practices for successful implementation.

What is Replenishment?

Replenishment is the process of moving products from bulk storage areas to picking locations to ensure that inventory levels meet demand. In a warehouse context, this means ensuring that fast-moving items are readily accessible to pickers, thereby optimizing picking efficiency and reducing order fulfillment times.

Replenishment Strategies:

Planned Replenishment
Automatic Replenishment
Crate Part Replenishment
Order-Based / Demand-Based Replenishment
Direct / Manual / Picker-Driven Replenishment

Create Storage types

Created 2 new storage types REP1 & REP2 for this replenishment example, one for replenishment at Storage Type level and one at Bin level. Also created few bins in each storage type using Create Storage Bin transaction /SCWM/LS01.

Please note that, reason for creating separate storage types for this example is only just to keep is isolated with other scenarios for better understanding, else you can update “Putaway Rule” & “Repl. level” of your existing storage types according to your replenishment configurations requirements.

SPRO > SCM Extended Warehouse Management > Extended Warehouse Management > Master Data > Define Storage Types

For replenishment storage types REP1 at Storage Type Level selected Putaway Rule = 4 (Gen Storage Area) & Repl. level = 1 (Storage Type level)

For replenishment storage types REP2 at Storage Type Level selected Putaway Rule = 4 (Addition to existing bin) & Repl. level = “ “ (Storage Bin level)

Create Warehouse Process Type

Created replenishment warehouse process type referring SAP standard process Type “3010” and selected warehouse process category = 3 (Internal Warehouse Movement)

SPRO > SCM Extended Warehouse Management > Extended Warehouse Management > Cross-Process Settings > Warehouse Task > Define Warehouse Process Type

And selected Activity = REPL (Replenishment)

Also selected document & item types as SRPL (Replenishment) under warehouse requests settings section

Determine Warehouse Process Type

Configured warehouse process determination for Document & Item Types “SRPL” to use our replenishment process type 3010

SPRO > SCM Extended Warehouse Management > Extended Warehouse Management > Cross-Process Settings > Warehouse Task > Determine Warehouse Process Type

Activate Replenishment Strategies in Storage Types

For this example activated Planned Replenishment strategies for our new storage types.

SPRO > SCM Extended Warehouse Management > Extended Warehouse Management > Internal Warehouse Processes > Replenishment Control > Activate Replenishment Strategies in Storage Types

Activated Planned Replenishment strategies for Warehouse Process Type 3010 that we are using, and selected Physical Quantity based replenishment along with “WT Immed” checkbox for Immediate Warehouse Task creation.

Maintain Document/Item Categories for Replenishment

Maintained configuration for document & item types SPRL for our warehouse process type 3010 that we are using in this replenishment example.

SPRO > SCM Extended Warehouse Management > Extended Warehouse Management > Internal Warehouse Processes > Replenishment Control > Maintain Document/Item Categories for Replenishment Warehouse Request

Customize Stock Transfer Process

For this example we are not making any changes in standards settings, but in case you have specific requirements to create document type or item type, or to use any custom action profile, status profile or partner profile etc., that can be done using below below configuration.

SPRO > SCM Extended Warehouse Management > Extended Warehouse Management > Internal Warehouse Processes >Delivery Processing > Stock Transfers > Define Document Types for the Stock Transfer Process

Specify Stock Removal Rules

For this example we will use FIFO rule for stock removal.

SPRO > SCM Extended Warehouse Management > Extended Warehouse Management > Goods Issue Process > Strategies > Specify Stock Removal Rules

Specify Storage Type Search Sequence

Defined new storage type search sequence “REPL” for replenishment process.

SPRO > SCM Extended Warehouse Management > Extended Warehouse Management > Goods Issue Process > Strategies > Specify Storage Type Search Sequence

And assigned new storage types REP1 & REP2 in sequence.

Define Stock Removal Control Indicator

Defined new Stock Removal Control Indicator “RELP” for replenishment.

SPRO > SCM Extended Warehouse Management > Extended Warehouse Management > Goods Issue Process > Strategies > Define Stock Removal Control Indicator

Determine Storage Type Search Sequence for Stock Removal

Maintained configuration for Determining Storage Type using new storage type search sequence “REPL” for warehouse process type 3010, using Stock Removal Control Indicator “RELP” and utilizing FIFO rule for stock removal.

SPRO > SCM Extended Warehouse Management > Extended Warehouse Management > Goods Issue Process > Strategies > Determine Storage Type Search Sequence for Stock Removal

Test Your Replenishment Configurations

Let us perform Bin Leve replenishment using configuration we made. For this example we will use sample product 240074 that has 5 pieces in bin IOWA-01–01–07.

So we assign Min 6 & Max 10 quantities for these bin using transaction /SCWM/BinMAT in bin IOWA-01–01–07, so that current quantity “5” is below the minimum configured quantity at bin level.

Now verify the product configurations including Stock Removal configuration changed to use new Stock Removal indicator “REPL” we created for this example.

Note: In real scenario you may be using existing stock removal indicator and may not be creating new indicator as we created for this example to avoid impact on other scenarios test data.

Now just run replenishment for this test product using transaction /SCWM/REPL selecting planned replenishment.

As expected replenishment executed for additional 5 pieces to make total 10 pieces in IOWA-01–01–07 to match the max configured quantity at bin level.

After reviewing replenishment data select the row and execute.

I intentionally unchecked immediate warehouse creation checkbox “WT Immed” to create warehouse request so that I can show creation of further warehouse tasks manually using transaction /SCWM/IM_ST in this example below Internal Stock Transfer #6101300 was created.

Before creating warehouse task I just added some sock in our replenishment bin as that will be used for this replenishment here, and then created warehouse task.

And after confirming the created task you will notice warehouse order like below is created for replenishment of 5 pieces to Bin IOWA-01–01–07 according to the configurations.

And after confirming this warehouse order you will notice replenishment is complete and Bin IOWA-01–01–07 now has 10 pieces that we configured as max quantity for this bin.

In this example we covered Bin Level Replenishment, similarly you can also configure Storage Type level Min Max at product level using /SCWM/MAT1 transaction.

Best Practices for Effective Replenishment in SAP EWM

Utilize Automated Processes: Leverage SAP EWM’s automation capabilities to streamline replenishment order creation and task assignment, reducing manual intervention and errors.
Implement Dynamic Slotting: Use dynamic slotting strategies to adjust the placement of items based on demand patterns, ensuring that high-velocity items are stored in easily accessible locations.
Collaborative Planning: Foster collaboration between inventory management, sales, and warehouse teams to ensure alignment on demand forecasts and replenishment strategies.
Regular Training: Provide regular training to warehouse staff on the replenishment process, system updates, and best practices to ensure they are equipped to handle replenishment tasks efficiently.
Review and Adjust Strategies: Regularly review replenishment strategies and thresholds to ensure they remain effective in response to changing demand patterns and business conditions.

Conclusion

The replenishment process in SAP EWM is a critical component of effective warehouse management, directly impacting inventory availability, operational efficiency, and customer satisfaction. By following a structured approach to replenishment, from demand forecasting to continuous monitoring and optimization, organizations can ensure that their warehouses operate smoothly and efficiently.

Implementing best practices and leveraging the capabilities of SAP EWM will enable organizations to streamline their replenishment processes, reduce costs, and enhance overall supply chain performance. As businesses continue to adapt to the dynamic nature of the market, mastering the replenishment process in SAP EWM will be essential for achieving operational excellence and sustained competitive advantage.