What is inventory surplus in SAP SCM-APO-SPP - Service Parts Planning?

SAP Term: inventory surplus

• Component: SCM-APO-SPP

• Component Name: Service Parts Planning

• Description: Definition of the stock of a product if the warehouse stock and stock in transit within the bill of distribution BOD is greater than the probable demand for this period during a certain period of time.

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• Key Concepts: 
  Inventory surplus is a term used in SAP's SCM-APO-SPP Service Parts Planning component. It refers to the amount of inventory that is held in excess of the amount needed to meet customer demand. This excess inventory is typically held in reserve to ensure that customer orders can be fulfilled in a timely manner. 
  
  How to use it: 
  Inventory surplus can be managed by setting up a safety stock level. This safety stock level should be set at a level that is sufficient to meet customer demand, but not so high that it results in unnecessary costs. The safety stock level can be adjusted as needed based on changes in customer demand or other factors. 
  
  Tips & Tricks: 
  It is important to monitor inventory surplus levels on a regular basis to ensure that they remain within acceptable levels. If the inventory surplus level is too high, it may result in unnecessary costs and inefficient use of resources. On the other hand, if the inventory surplus level is too low, it may result in customer orders not being fulfilled in a timely manner. 
  
  Related Information: 
  Inventory surplus is closely related to other concepts such as safety stock, reorder points, and lead times. Understanding how these concepts interact with each other can help ensure that inventory levels are managed effectively and efficiently.