Understand Inventory Status and Occurrence Date in Proposed Orders

Created by Shyam Sayana, Modified on Tue, 14 Oct at 1:00 PM by Shyam Sayana

Purpose

The Inventory Status and Occurrence Date provide planners with real-time visibility into inventory health during replenishment planning. These indicators help identify when a Low Stock or Stock-Out situation will occur within the lead time horizon, enabling planners to take proactive actions before supply shortages impact operations.

TABLE OF CONTENTS

Purpose
Overview
Lead Time Horizon Evaluation
Inventory Status Definitions
Occurrence Date Logic
- User Interface
Example : Scenrarios
Key Rules and Notes
Business Impact

Overview

The replenishment solver engine evaluates inventory availability for every proposed order line during order generation.

It calculates:

The Inventory Status — representing the health of the item’s supply during the lead time window.
The Occurrence Date — indicating when a Low Stock or Stock-Out situation will begin.

These details are captured in two separate columns in the proposed orders screen.

Lead Time Horizon Evaluation

During each solver run, the application evaluates inventory status across the entire lead time period (e.g., 7, 14, 30, or 90 days).

The solver considers:

On-hand inventory
In-transit quantities (with receipt dates within the lead time)
Forecasted demand during the lead time
Safety stock or minimum stock thresholds

The solver excludes future Suggested Order Quantities (SOQs) when computing these values.
Each proposed order generation recalculates these fields to ensure data accuracy.

Inventory Status Definitions

Status	Definition
On Target	Definition: Total supply (on-hand + in-transit within lead time) is greater than or equal to total demand and satisfies the safety stock threshold. Interpretation: Inventory position is healthy; no immediate action required.
Low Stock	Definition: Total supply during lead time is less than safety stock but greater than zero. The Occurrence Date marks when inventory first drops below safety stock. Interpretation: Inventory expected to fall below safety stock soon; planner may monitor or trigger an order.
Stock-Out	Definition: Total supply during the lead time is insufficient to meet demand (zero or negative balance). The Occurrence Date marks when the inventory is fully depleted. Interpretation: Inventory will run out during the lead time; immediate replenishment is required.
Overstock	Definition: Total supply during the lead time significantly exceeds demand or maximum stock limits. No proposed orders are created in this case, and the occurrence date remains blank. Interpretation: Supply exceeds expected demand; solver ignores these cases for order generation.

Note: The solver generates proposed orders only for Low Stock and Stock-Out scenarios.  In a few cases, if might generate orders even when the Inventory status is On Target by considering future requriements.

Occurrence Date Logic

The Occurrence Date identifies when a potential shortage begins within the lead time horizon.

Status Type	Logic
Low Stock	Earliest date when total supply (on-hand + in-transit) drops below safety stock.
Stock-Out	The Earliest date when the total supply becomes zero or insufficient to meet immediate demand.
On Target / Overstock	The Occurrence Date field remains blank or shows “N/A”.

The date format for Occurrence Date is based on the attribute configuration defined in the Admin App.

User Interface

The Proposed Orders screen includes two additional columns:
- Inventory Status – Displays the calculated status.
- Occurrence Date – Displays the date when the shortage begins.
For Low Stock and Stock-Out, both fields are populated automatically during solver execution.
For On Target and Overstock, the occurrence date remains blank or N/A.

Example : Scenrarios

Let's assume the replenishment engine was run on Oct 1, 2025

Example 1: Stockout scenario at the end of the lead time

Parameter	Value
Lead Time	60 days (≈ 9 weeks)
On-Hand Inventory	5,100 units
In-Transit Supply (within LT)	2,000 units
Total Supply	7,100 units
Weekly Demand	800 units
Safety Stock	500 units
Order policy	Due Order

Let's assume that the replenishment engine was run on Oct 1, 2025, where the current period is Sep 29, 2025, to Oct 06, 2025

Week	Start date	End Date	Starting Supply	Demand	Ending Supply	Remarks	Inventory Status	Occurrence date
Week 1	09/29	10/06	7,100	800	6,300	Sufficient supply	On Target
Week 2	10/07	10/14	6,300	800	5,500	Sufficient supply	On Target
Week 3	10/15	10/22	5,500	800	4,700	Sufficient supply	On Target
Week 4	10/23	10/30	4,700	800	3,900	Sufficient supply	On Target
Week 5	10/31	11/07	3,900	800	3,100	Sufficient supply	On Target
Week 6	11/08	11/15	3,100	800	2,300	Sufficient supply	On Target
Week 7	11/16	11/23	2,300	800	1,500	Sufficient supply	On Target
Week 8	11/24	12/01	1,500	800	700	Barely above safety stock (500)	On Target
Week 9	12/02	12/09	700	800	-100	A supply shortage occurred	Stockout	Dec 02, 25

Inventory Status: Stockout
Occurrence Date: 02 Dec 2025
Explanation: The supply of 7,100 units fulfilled demand until Week 8; however, in Week 9, a shortage of 100 units occurred, resulting in a stockout exception.

Example 2: Stockout scenario - Supply doesn't meet the demand during the lead time.

Parameter	Value
Lead Time	60 days (≈ 9 weeks)
On-Hand Inventory	5,000 units
In-Transit Supply (within LT)	0 units
Total Supply	7,100 units
Weekly Demand	800 units/Week (Weeks 1–4), then 1,000 units/week (Weeks 5–9
Safety Stock	600 units
Order policy	Due order

Computation

Week	Start date	End Date	Starting Supply	Week Demand	Ending Supply	Remarks	Inventory Status	Occurrence date
Week 1	09/29	10/06	5,000	800	4,200	Sufficient supply	On Target
Week 2	10/07	10/14	4,200	800	3,400	Sufficient supply	On Target
Week 3	10/15	10/22	3,400	800	2,600	Sufficient supply	On Target
Week 4	10/23	10/30	2,600	800	1,800	Sufficient supply	On Target
Week 5	10/31	11/07	1,800	1000	800	Barely above safety stock (600)	On Target
Week 6	11/08	11/15	800	1000	-200	Stockout	Stock out	Nov 08, 2025
Week 7	11/16	11/23	-200	1000	-1,200	Stockout	Stock out
Week 8	11/24	12/01	-1,200	1000	-2,200	Stockout	Stock out
Week 9	12/02	12/09	-2,200	1000	-3,200	Stockout	Stock out

Note: Negative supply is just for representation to demonstrate that there is 0 or negative supply. Hence considered it as Stockout scenario

Inventory Status: Stockout

Occurrence Date: Nov 08, 2025 (Start of Week 6)
Explanation: Supply remains healthy until week 5. As there is no new supply, the remaining supply has fallen below 0, causing a stockout situation.

Recommendation by replenishment engine: The engine creates a proposed order with Order Date = Oct 1, 2025.

Example 3: Low Stock scenario - Supply meets demand. However, supply is below the Min-Max Minimum inventory.

Parameter	Value
Lead Time	21 days (≈ 3 weeks)
On-Hand Inventory	3,000 units
In-Transit Supply	0 units
Weekly Demand	700 units
Min-Max Minimum Inventory	500 units
Policy	Min-Max Inventory

Computation

Week	Start date	End Date	Starting Supply	Demand	Ending Supply	Remarks	Inventory Status	Occurrence date
Week 1	09/29	10/06	3,000	700	2,300	Sufficient supply	On Target
Week 2	10/07	10/14	2,300	700	1,600	Sufficient supply	On Target
Week 3	10/15	10/22	1,600	700	900	Supply barely above safety sock (500 units)	On Target
Week 4	10/23	10/30	900	700	200	Supply falls below safety stock	Low Stock	Oct 23, 2025

Inventory Status: Low Stock
Occurrence Date: Oct 23, 2025 (Start of Week 4)
Explanation: By week 4, the ending supply falls below the Min-Max Minimum inventory (i.e., 500 Units). The solver flags this as a Low Stock status and creates a Proposed order with an order date of Oct 07, 2025, with a Need by date as Oct 23, 2025, with SOQ = Min-Max Maximum inventory.

Example 4: Sufficient supply to meet demand during lead time.

Parameter	Value
Lead Time	14 days (≈ 2 weeks)
On-Hand Inventory	3,000 units
In-Transit Supply	0 units
Weekly Demand	700 units
Min-Max Minimum Inventory	500 units
Policy	Min-Max Inventory

Computation

Week	Start date	End Date	Starting Supply	Demand	Ending Supply	Remarks	Inventory Status	Occurrence date
Week 1	09/29	10/06	3,000	700	2,300	Sufficient supply	On Target
Week 2	10/07	10/14	2,300	700	1,600	Sufficient supply	On Target
Week 3	10/15	10/22	1,600	700	900	Supply barely above safety sock (500 units)	On Target
Week 4	10/23	10/30	900	700	200	Supply falls below safety stock	Low Stock

Inventory Status: On Target
Occurrence Date: NA
Explanation: By week 4, the ending supply falls below the Min-Max Minimum inventory (i.e., 500 Units).

However, the lead time is 14 days (≈ 2 weeks).
This means there is sufficient inventory to meet the demand and Safety stock requirements till Week 3.
However, the replenishment engine creates a proposed order for Week 4 (beyond lead time), as there is potential for a low stock scenario. This applies to both Due Order and Min-Max Policy.

Key Rules and Notes

Lead Time Boundaries:
- Only in-transit receipts arriving within the lead time window are included in the computation.
  Future receipts beyond lead time are ignored.
Future SOQs:
- Suggested orders are excluded from both inventory status and occurrence date logic.
Status Triggers:
- Only Low Stock and Stock-Out statuses trigger new proposed orders.
Automatic Recalculation:
- The solver recalculates inventory status and occurrence date each time proposed orders are generated to ensure accurate results.

Business Impact

Identify potential stock issues earlier.
Prioritize replenishment efforts by urgency.
Avoid unnecessary order duplications or overstocking.
Increase the overall responsiveness of the replenishment process.