By default the planning algorithm will trigger a replenishment for a buffer as soon as its inventory level drops below the safety stock. This logic is based on the local needs at the buffer.
In a distribution network with inventory at multiple locations, considering the inventory across the entire network for the purchasing decisions can significantly reduce the inventory and obsolesence costs.
Using the global purchase flag we can prevent a new purchase order to be created when sufficient inventory is still available at other locations in the network. And it directs demands to locations that have available inventory.
This feature has 2 specific planning behavior:
Imagine a distribution network with inventory at a number of warehouses across the country for a particular item:
A sales order from a customer close to WH2 can easily be shipped from WH1 instead. With the global_purchase flag set, we will automatically redirect the demand to WH1 (which has highest inventory above its safety stock) and WH3.
Any new purchase orders for this item are deplayed until the total inventory across all location drops below 30 = 10 + 10 + 10.