Managing Off-Site Warehouses at Manufacturers using Microsoft Dynamics AX & 365 for Finance and Operations, Enterprise

Many manufacturers face the challenge of managing transfers between a manufacturing plant and nearby off-site warehouses for raw materials or finished goods or both, typically motivated by the need for additional warehouse space. This scenario differs slightly from others involving transfers, which use them as a mechanism to model variations in managing their supply chain activities. Examples of other scenarios include transfers related to a distribution network for finished goods, transfers (or deliveries) of raw materials to warehouses representing subcontracted manufacturers, transfers between sites in a multisite manufacturing operation, and transfers to remote sites.

The supply chain management (SCM) aspects of coordinating inventory at off-site warehouses can be reasonably simple and straight forward, and they typically involve transportation considerations. It can get more complicated in some scenarios, such as using advanced warehousing capabilities to manage palletized inventory and loads, or using consignment inventory. It can also impact the S&OP approaches that drive SCM coordination activities at the off-site warehouses and the manufacturing plant.

As an explanatory approach, it is easiest to start with a common scenario of a manufacturing plant with off-site warehouses for raw materials and finished goods, and then provide illustrative case studies about more complicated scenarios. These considerations are reflected in the following sections within the article.  

1. Common Scenario of Off-Site Warehouses for Raw Materials and Finished Goods
2. Basic Model of SCM Decision Making about Planned Transfers
3. SCM Coordination of an Off-Site Warehouse for Raw Materials
4. SCM Coordination of an Off-Site Warehouse for Finished Goods

The explanation applies to the current version of Microsoft Dynamics 365 Finance and Operations, Enterprise edition (termed D365FOE for short), and it applies to previous versions of Dynamics AX ...