What is pooling factor in SAP MA-SMOPS - SmartOps?

SAP Term: pooling factor

• Component: MA-SMOPS

• Component Name: SmartOps

• Description: Used to make an adjustment to demand standard deviations by multiplying the demand standard deviation with the pooling factor to accommodate the correlation of demand across downstream stocking points.

Smart SAP Assistant

• Key Concepts: 
  Pooling factor is a concept used in SAP MA-SMOPS SmartOps to determine the optimal order quantity for a given item. It is calculated by dividing the total demand for an item over a certain period of time by the number of orders placed during that same period. The result is a number that represents the average order quantity for that item. 
  
  How to use it: 
  To calculate the pooling factor, you need to know the total demand for an item over a certain period of time and the number of orders placed during that same period. Once you have this information, divide the total demand by the number of orders to get the pooling factor. 
  
  Tips & Tricks: 
  When calculating the pooling factor, it is important to consider any seasonal fluctuations in demand. This will help ensure that you are getting an accurate representation of the average order quantity for an item. 
  
  Related Information: 
  The pooling factor can be used in conjunction with other metrics, such as inventory turnover rate and lead time, to determine the optimal order quantity for an item. It can also be used to identify areas where inventory levels can be reduced or increased in order to improve efficiency and reduce costs.