What is substitution type in SAP SCM-FRE - Forecasting and Replenishment?

SAP Term: substitution type

• Component: SCM-FRE

• Component Name: Forecasting and Replenishment

• Description: Defines whether there is to be a switch from the original product to the follow-up or replacement product.

Smart SAP Assistant

• Key Concepts: 
  Substitution type is a feature in the Forecasting and Replenishment (FRE) component of SAP SCM. It allows users to define a substitution rule for a certain item, which will be used to replace the item when it is not available. This substitution rule can be based on either an item or a group of items. 
  
  How to use it: 
  To use substitution type, users must first define the substitution rule in the system. This can be done by going to the Substitution Type tab in the FRE component and selecting the item or group of items that will be used as a substitute. Once this is done, users can then assign the substitution type to an item in the system. This will ensure that when the item is not available, it will be replaced with the substitute item or group of items. 
  
  Tips & Tricks: 
  When defining a substitution rule, it is important to consider how it will affect other items in the system. For example, if an item is substituted with a group of items, it may cause an imbalance in inventory levels or lead to incorrect pricing. It is also important to ensure that the substitute item or group of items is compatible with the original item. 
  
  Related Information: 
  Substitution type is just one of many features available in SAP SCM's Forecasting and Replenishment component. Other features include demand forecasting, inventory optimization, and replenishment planning. All of these features work together to help users manage their inventory more efficiently and accurately.