Awesome SCM

Reference: lokad.com

The fill rate is the fraction of customer demand that is met through immediate stock availability, without backorders or lost sales. The fill rate differs from the service level indicator. The fill rate has a considerable appeal to practitioners because it represents the fraction of the demand that is likely to be recovered or better serviced if the inventory performance was to be improved. The fill rate is measured empirically by averaging the number of correctly serviced requests over the total number of requests.

Reference: leanmanufacture.net

Two bin systems are common on assembly and moving manufacturing lines where components are added to the product or item being built. The two bin system is just like its name suggests, it is composed of two bins which are full of components or materials to start. As production commences one bin is drawn down of materials and the other bin, which is still full, acts as the buffer or safety stock.

When the first bin is completely depleted the worker or assembly line worker switches to the other bin, similar to a FIFO system. The switch of bins can be interpreted as a kanban signal for the supply process of that particular component to manufacture or supply the component just in time before the second bin runs out of material. The kanban signal can also be generated half way throughout the first bin, depending on lead times for the component to be supplied. 

This system in a way is similar to the EOQ inventory model with safety stock. It is a very common system used in vehicle manufacturing plants. The size or number of components in each bin is usually determined using the EOQ inventory model or a time period model. 

Reference: http://www.businessdictionary.com/definition/backflushing.html

Process of determining the number of parts that must be subtracted from inventory records. This number is computed by referring to the number of parts withdrawn from the inventory (and delivered to the shopfloor) and the number of parts assumed (according to the bill of materials) to have been consumed in a manufacturing line at one or more deduct points.

Reference: Inventoryops.com

Backflushing

method for issuing (reducing on-hand quantities) materials to a manufacturing order. With backflushing, the material is issued automatically when production is posted against an operation. The backflushing program will use the quantity completed to calculate through the bill of material the quantities of the components used, and reduce on-hand balances by this amount. There are usually options during the backflush process to report scrap. In operations using backflushing it is advisable to set up specific machine locations and have materials transferred from storage locations to machine locations when they are physically picked for production. The backflush operation will then issue the material from the machine locations. Read my article on Backflushing.

Reference: erpgreat.com

Back flushing is nothing but automatic goods issue. System will automatically posts the goods issue when you confirm the operations.You have no need to make manual issue. It will reduce the effort. Backflushing is automatic accounting (Goods issues - 261 mvt) of material consumed for production, at the time of confirmation. Eg. When a 4 wheeler automobile is rolled out from assy line, 4 wheels & Tyres are deemed to be consumed and issued to production order automatically by way of backflushing by the system. 

Backflush Costing

Cost Accounting

Just In Time

Production Cost

Activity-Based Costing - ABC

Cost of Revenue

Carrying Cost Of Inventory

Operating Cost

Inventory Management

Absorption Costing