What is target stock level in SAP PP-MRP - Material Requirements Planning?

SAP Term: target stock level

• Component: PP-MRP

• Component Name: Material Requirements Planning

• Description: A dynamic safety stock. The target stock level is calculated using the formula: target range of coverage * average daily requirement

Smart SAP Assistant

• Key Concepts: 
  Target stock level is a term used in SAP's Material Requirements Planning (MRP) component. It is the desired amount of inventory that a company wants to maintain for a particular material or product. This target stock level is used to determine the amount of material that needs to be ordered or produced in order to meet customer demand. 
  
  How to use it: 
  In order to use the target stock level, a company must first set the desired amount of inventory they want to maintain for a particular material or product. This can be done by entering the target stock level into the MRP system. Once this is done, the system will then calculate the amount of material that needs to be ordered or produced in order to meet customer demand. 
  
  Tips & Tricks: 
  It is important to keep in mind that the target stock level should be set based on customer demand and not on what the company thinks they need. This will ensure that there is enough inventory available to meet customer demand without overstocking and wasting resources. 
  
  Related Information: 
  The target stock level is closely related to other terms such as safety stock, reorder point, and lead time. Safety stock is the amount of inventory that is kept in reserve in case of unexpected demand or supply disruptions. Reorder point is the point at which an order should be placed in order to maintain the desired target stock level. Lead time is the amount of time it takes for an order to arrive after it has been placed.