🔹 Introduction
In Oracle E-Business Suite (R12), Min-Max Planning is
a simple yet powerful inventory planning method used to maintain optimal
stock levels and automate replenishment decisions.
The concept is straightforward:
- Define a minimum quantity (reorder point)
- Define a maximum quantity (target level)
When inventory drops below the minimum, Oracle automatically
suggests replenishment to bring stock back up to the maximum.
This makes Min-Max Planning particularly useful for:
- Spare parts management
- High-volume consumables
- Non-MRP environments
🔹 What is Min-Max
Planning?
Min-Max Planning ensures that:
If available inventory < Minimum → System suggests
replenishment
Order Quantity = Maximum – Available Quantity
The system considers:
- On-hand inventory
- Open purchase orders
- Demand (optional)
👉 Based on this, Oracle
generates:
- Purchase Requisitions (Buy items)
- Internal Requisitions
- WIP Jobs (Make items)
🔹 Planning Levels in
Oracle R12
✅ 1. Organization-Level Planning
At this level, Oracle considers:
- Inventory across all subinventories
- Purchase Orders & WIP Jobs (Supply)
- Sales Orders & WIP Demand (optional)
👉 This is best for
centralized planning
📌 Key Logic:
- Total Available = On-hand + On-order – Demand
- If below minimum → create replenishment
✅ 2. Subinventory-Level Planning
Planning is restricted to a specific subinventory.
Key Differences:
- No WIP jobs considered
- Only local demand/supply
- Generates requisitions only (no jobs)
👉 Best for:
- Warehouse-level control
- Store or location-specific planning
🔹 Key Setup Steps
✅ Step 1: Define Item Attributes
For each item:
- Inventory Planning Method = Min-Max Planning
- Min Quantity
- Max Quantity
- Min/Max Order Quantity
👉 These attributes
control how replenishment is calculated.
Item: PC028X0021-
AS - CW
Category: GNE_PIPES_CATEGORY
✅ Step 2: Define Sourcing Rules
Set:
- Supplier (for Buy items)
- Source Organization (for Internal Replenishment)
👉 System uses these to
generate requisitions automatically.
For the sourcing rule, I have
prepared another blog
✅ Step 3: Configure Planning
Parameters
While running the report, define:
- Demand Cutoff Date
- Supply Cutoff Date
- Include Demand (Yes/No)
- Include Supply (PO, WIP)
👉 These parameters
directly impact planning accuracy.
✅ Step 4: Run Min-Max Planning
Report
Navigation:
Inventory → Reports → Min-Max Planning
Key Options:
- Planning Level (Org / Subinventory)
- Restock (Yes → create requisitions)
- Net Demand Options
👉 The report drives the
entire process.
Report parameters:
You can see, that Min-max planning report suggested the
re-order quantity
🔹 Core Calculation Logic
(Simplified)
Oracle calculates:
- Total
Available = On-hand + On-order – Demand
If:
Total Available < Minimum
Then:
Order Quantity = Maximum – Total Available
👉 System adjusts quantity
based on:
- Minimum Order Quantity
- Maximum Order Quantity
- Fixed Lot Size
🔹 Example (Real Scenario)
Let’s say:
- On-hand = 25
- On-order = 50
- Demand = 90
- Minimum = 100
- Maximum = 500
Calculation:
- Total Available = 25 + 50 – 90 = -15
- Below Minimum → Yes
- Suggested Order = 500 – (-15) = 515
👉 System will generate
requisition for 515 units
📌 Scenario: Frequent
Stockouts in Spare Parts
A client in manufacturing faced:
- Frequent stockouts of critical spare parts
- Manual planning errors
- Emergency purchases (high cost)
⚠️ Challenge
- No structured inventory planning
- No reorder point defined
- Procurement delays
✅ Solution Implemented
We implemented Min-Max Planning:
- Defined Min/Max levels based on consumption
- Enabled Organization-level planning
- Scheduled Min-Max Report daily
- Automated requisition creation
💡 Outcome
- Reduced stockouts by ~60%
- Eliminated emergency purchases
- Improved procurement planning
- Increased inventory visibility
🔹 Key Benefits
✔ Simple and easy to implement
✔ No complex forecasting required
✔ Automates replenishment
✔ Reduces manual effort
✔ Improves stock availability
🔹 Limitations
❗ Not suitable for:
- Complex manufacturing planning
- Demand forecasting scenarios
- Long lead-time items
👉 For such cases → use MRP
/ ASCP
🔹 Best Practices
- Define realistic Min/Max levels (based on
consumption)
- Schedule planning report regularly
- Use subinventory planning for warehouse control
- Monitor exceptions (overstock / stockout)
- Align with procurement lead times
🔹 Conclusion
Oracle R12 Min-Max Planning is a practical and efficient
inventory control method that helps organizations maintain optimal stock
levels without complex planning systems.
When implemented correctly, it
provides:
- Better inventory control
- Reduced stockouts
- Improved operational efficiency
🔹 Reference
Oracle Documentation:
https://docs.oracle.com/cd/A60725_05/html/comnls/us/inv/mnmxplan.htm