What is obsolescence cost in SAP MA-SMOPS - SmartOps?

SAP Term: obsolescence cost

• Component: MA-SMOPS

• Component Name: SmartOps

• Description: The cost that accounts for the decrease in inventory value due to the introduction of newer and more competitive products, physical perishability of goods, or other events.

Smart SAP Assistant

• Key Concepts: 
  Obsolescence cost is a term used in SAP's MA-SMOPS SmartOps module. It refers to the cost associated with the replacement of obsolete materials or components. This cost can include the cost of purchasing new materials, the cost of disposing of the old materials, and any other associated costs. 
  
  How to use it: 
  In SAP's MA-SMOPS SmartOps module, obsolescence cost is used to calculate the total cost of replacing obsolete materials or components. This cost is then used to determine the total cost of production and can be used to inform decisions about production processes and strategies. 
  
  Tips & Tricks: 
  When calculating obsolescence cost, it is important to consider all associated costs, such as the cost of purchasing new materials, the cost of disposing of the old materials, and any other associated costs. Additionally, it is important to consider how long it will take to replace the obsolete materials or components in order to accurately calculate obsolescence cost. 
  
  Related Information: 
  Obsolescence cost is closely related to inventory management and production planning. It is important for businesses to understand obsolescence cost in order to make informed decisions about production processes and strategies. Additionally, understanding obsolescence cost can help businesses reduce their overall production costs.