![]() ![]() The decoupled lead time represents the time that is required to produce or receive an item if the decoupling points are always in stock. Yellow zone = Average daily usage (ADU) × Decoupled lead time.It's calculated by using the following equation: In other words, it's the expected consumption during the replenishment lead time. This zone represents the quantity that you consume from the moment when you order until the order arrives. The yellow zone is typically calculated first. This section explains how the height of each buffer zone is calculated. The following illustration shows the three colored zones and how they relate to the minimum quantity, maximum quantity, and reorder point. This point is the maximum level that the stock will be replenished to. The maximum quantity is also referred to as "top of green". ![]() Green zone – The area between the reorder point and the maximum quantity.When this point is reached, the system should reorder. The reorder point is also referred to as "top of yellow". Yellow zone – The area between the minimum quantity and the reorder point.The minimum quantity is also referred to as "top of red," and your planning strategy should be designed to ensure that stock levels are always above this point. Red zone – The area below the minimum quantity.These values establish three difference zones, which are identified by the following color codes: In DDMRP, each stock buffer is defined by using three values: the minimum quantity, the maximum quantity, and the reorder point. This task is the second step of Demand Driven Materials Resource Planning (DDMRP). After you've identified your decoupling points (key items that you will strategically keep in stock), you must decide how much stock (buffer) you will keep at each of them.
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