Quick Summary: Establish a baseline inventory strategy by assigning a default Replenishment Cycle (RC) and Target Fill Rate (%) to each classification matrix bucket via the Policy Defaults screen.
Why Policy Defaults Matter
The Policy Defaults screen is where you execute the strategy you developed from the Classification matrix. This is your primary tool for ensuring that all your stocked items automatically receive a sensible, baseline inventory policy that aligns with their business value and sales velocity.
By setting different defaults for each bucket, you can make strategic trade-offs. For example, you can assign a short RC to your expensive, high-value AH items to minimize working capital, while giving your cheap, fast-moving CH items a long RC to reduce administrative overhead.
Understanding the Role of Defaults and Overrides
Policy defaults and overrides are powerful tools that allow you to customize the app's behavior to meet your specific business requirements:
Policy Defaults: Apply broad, standard inventory rules based on classification (e.g., AH, CH)
Policy Overrides: Provide granular control, allowing you to fine-tune settings for particular subsets of products.
Together, they allow you to balance strategic consistency with tactical flexibility.
What Are Policy Defaults?
The Policy Defaults screen allows you to set the default Replenishment Cycle (RC) and Target Fill Rate (%) for every bucket in your 9-block classification matrix (for example, AH, AM, AL, CL).
Replenishment Cycle (RC): Controls how much to order (in days).
Target Fill Rate (%): Controls the desired service level, which directly influences the calculation of safety stock.
Strategic Thought Process for Policy Defaults
How To: Assign Policy Defaults
➜ Read: How To: Assign Policy Defaults
Mastering Policy Overrides
➜ Read: Mastering Policy Overrides
⚠️ Watchouts
Policies are Dynamic: These defaults are tied to the classification bucket. If an item's classification changes (e.g., it moves from an AH item to an AM item), its policy values will automatically change to the default policy you have set for the AM bucket unless an override exists.
Stocked Items Only: Policy defaults for RC and Target Fill Rate only apply to items in the 9-block Stocked matrix. They do not apply to items classified as Non-stocked or Obsolete.
💡 Tips
Consider the “Why”: When setting these defaults, think about the strategic goal for each bucket. Are you trying to reduce working capital, minimize administrative requirements, or save warehouse space? Let your answers guide your RC and Target Fill settings.
Forget about these 👇 😞 😐 😃 Have your say here!