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User guide for LSSC
This guide will help you to understand the features provided by
Lokad Safety Stock Calculator (LSSC).
This application targets retailers and manufacturers who need to optimize their inventory levels and their replenishment orders.
Big picture
LSSC features inventory optimization reports. In order to produce the reports, LSSC depends on two other applications:
- a business database where the inventory data is retrieved from. LSSC supports natively many 3rd party applications. Plus, we provide LSSC Editor (part of the LSSC package) that let you easily design connectors for custom or unsupported applications.
- the Lokad forecasting services that forecast the demand. The demand data is first uploaded to Lokad (data being obfuscated beforehand), and the demand forecasts are downloaded from Lokad.
Thanks to Lokad, LSSC computes, in a completely automated manner, stock covers and optimized reorder points.
LSSC is an open-source application (so the application itself is free), but it relies on a
Lokad subscription plan to enable the forecast retrieval.
Setting up a report
Start LSSC and click on
File » New. The report setup wizard appears. This wizard will guide you while defining your report settings.
Lokad settings
The first wizard panel is named
Lokad account settings.
Latest version, 2.5 and above: You need to enter an API key as obtained from your
Lokad account. You registration email also contains a pre-generated API key.
Version 2.4 and below: You need to enter the same login and password that you are using to access your
Lokad account.
Unless you are a developer hacking into LSSC, we suggest you do not change the
Lokad Forecasting Service.
Inventory Report Properties
The second wizard panel is named
Inventory Report Properties. This panel let you define the type of report that you want.
The
Period defines the level of aggregation used in the report (i.e. day, week, month). We suggest to use the period which addresses your business requirements in the most practical manner.
The
Past periods indicates how many periods of past demand (usually sales) will be displayed in the report. Note that this setting has no impact on the forecasts.
The
Future periods indicates how many periods of future demand will be forecasted. We suggest that you choose a number of periods that is
twice as large as your typical lead time. Indeed, the lower of
future periods, the faster the forecast retrieval will be. Yet, if
future periods is too low (in particular, lower than the lead time), the accuracy of the suggested reorder point will be diminished.
Older versions only, 2.4 and below: For the period reference, you can check this
blog post.
Inventory Adapter
The third and fourth wizard panels are the
Inventory Adapter Type panel which let you choose your business application (where the inventory data will be retrieved from), and the
Connection String panel that lets you enter the database connection string associated to the business application.
If your business application does not appear in the list, do not hesitate to drop us an email at
support@lokad.com. We will see what we can do to support your application as well. If you run a custom application, you can use the
LSSC Editor to design your own inventory adapter.
Tip: save your report. After completing the report setup wizard, we suggest to save the report using
File » Save to be sure not to loose your settings.
Generating the report
Once you have completed the report setup wizard (see the previous section for more details), you need to
generate your report by clicking the
Refresh button. This button will start a complete refresh of your report (retrieving the latest inventory data and the latest forecasts).
Newer versions, 2.5 and above: The full refresh typically takes about 5 to 10min for the forecast computation, plus the time required to upload your data which depends on the internet connection speed.
Older versions, 2.4 and below: The full refresh takes over 1h, mostly due to the fact that the forecast's retrieval is delayed of 1h after the upload toward Lokad.
Last refresh displays the time of last
complete refresh for your convenience.
You can also perform a manual / partial report refresh through
Tools»Partial refresh operations. The
Refresh button is only executing the following operations in sequence:
- Retrieve inventory
- Upload demand
- Download forecasts
Understanding the report
The LSSC report includes quite a few columns (check this
report screenshot). This section describe the purpose of each column.
What's an SKU? SKU means Storage Keeping Unit. If you have only one storage location, then, most likely, there will be no difference between your product references, and your SKU references. If you have multiple storage locations then a single product reference can be associated to multiple SKUs.
Which data gets uploaded to Lokad? The report contains many data columns, but only the
past demand,
tags and
events gets uploaded to Lokad. Other data columns (i.e. suppliers, product names, ...) are NOT transmitted to Lokad.
SKU names
The name or reference that defines each SKU.
Product name
The product name or reference associated to the SKU.
Tags
Optional
tags that describe the SKU to allow Lokad to provide better forecasts.
If your inventory adapter does not support tags, then this column will be editable. You would be able to enter any number of tags separated by the spaces.
Events
This column displays number of
events (optional) associated with any given SKU. Clicking on the button will show
Event Management UI for the SKU's events.
Supplier
The supplier name or identifier associated to the SKU.
On hand
The
stock on hand within the SKU (i.e. the number of items readily available).
Reorder point
The suggested amount of inventory that should trigger a replenishment order. If the
stock on hand becomes smaller than the
reorder point, we suggest to make a replenishment order.
The reorder point is computed based on the
forecasted demand, the
service level and the
lead time. The column will stay blank as long as you do not have retrieved your forecasts.
Service level
The service level indicates the
chosen probability of not encountering a shortage. Typical service level values range from 80% to 99.9% depending on the business requirements. The higher the service level, the higher the reorder point.
The service level is represented as a percentage. Values are in the range 1 .. 100 (exclusive). Note that a service level equal to 100% would be equivalent to an infinite safety stock.
Lead time
The lead time indicates the total time needed between the reorder and the stock on hand replenishment. This value typically depends on your supplier constraints.
The lead time is expressed in days.
Stock cover
The stock cover indicates how much time the current inventory will last before encountering a shortage if no reorder is made. This value is computed based on the
stock on hand and the
forecasted demand.
Stock cover is expressed in days. The column will stay blank as long as you haven't retrieved the forecasts.
F column
The column named
F contains check-boxes (all checked by default) that indicate whether the SKUs should be forecasted or not. Indeed, the Lokad subscription price depends on the
number of forecasting tasks. Thus, you might consider that some SKUs are not worth to be forecasted (ex: SKUs with very low sales volumes).
MAPE
MAPE stands for
Mean Absolute Percentage Error, it's the expected error associated to the
forecasted demand. Statistical forecasts are always subject to errors (simply because the future can't be exactly deduced from past data), yet Lokad is providing not only the forecasts, but also the expected forecast errors. The MAPE values are used to refine the suggested
reorder points based on the specified
service levels.
MAPE is expressed as a percentage. The column will stay blank as long as you haven't retrieved the forecasts.
Past demand
Past demand columns are represented with
dates used as column headers, and the cell's backgrounds are
yellow. The past demand typically reflects either
sales (retail) or
consumption (manufacturing).
Forecasted demand
Forecasted demand columns are represented with
dates used as column headers, and the cell's backgrounds are
orange. The forecasted demand is computed by Lokad using the
past demand as input.
Editing the report
Certain column headers are in
bold (check this
screenshot for an example). This font style indicates that the data of this column cannot be retrieved from the 3
rd party application (i.e. most eCommerce software do not support
lead time). When the data cannot be directly retrieved, the user is invited to manually complete the column by entering its own data.
You need first to retrieve your inventory data (using the
Retrieve button), in order to start completing the report. Once you've edited your report, we suggest to save your changes using
File » Save to be sure that your work does not get lost.
Certain columns will stay blank as long some data is missing. For example,
reorder point will stay blank as long as you haven't provided a desired
service level.
The next time you perform an inventory retrieval, your edits
will NOT be discarded. The SKUs of the report will simply be updated with the most recent data as extracted from your business application.
Tips
This section contains a couple of useful tricks for LSSC.
Copy to Excel
It is really easy to copy and paste report data to your favorite spreadsheet processor.
 Copy and paste in LSSC |
Mass update
Introduced in version 1.2You can select a row by clicking on the extreme left column (a small triangle appears when the row is selected), and then copy the row with the copy shortcut
CTRL+C. Then, select all the rows in which you want to paste the data, and paste your data with paste shortcut
CTRL+V. All the writable columns values will be copied to destination rows.
Introduced in version 2.3You can update writable columns with some specific value by selecting
Edit | Update Columns With Value in the LSSC menu. Then you'll need to pick the name of the column to be updated and enter new value.
You can also update only the selected cells by selecting
Edit | Update Selected Cells With Value in the LSSC menu.
Sorting the report
You can sort any column on the report by clicking on the column header.
For example, if you want to sort the SKU against their respective suppliers (in order to facilitate the replenishment order), just click on
Suppliers.
Troubleshooting with the Application Logs
In case you would be encountering issues with
Retrieve,
Upload or
Download operations, you can display the
Application Logs through
View » Application Logs.
Clearing your account
You can remove all the data stored in your Lokad account through
Tools » Clear account.
Clearing the report
You can clear all the data existing in the report, only keeping the report settings themselves. Go
Tools » Clear report. This feature should be used when the data source has changed.
Custom inventory adapters
Note: this section is slightly more technical.
LSSC can natively retrieve data from numerous 3
rd party applications. For every application, LSSC includes an
inventory adapter. This adapter is nothing but an XML file that wraps the SQL queries used to retrieve the data.
Yet, in many situations, the default set of inventory adapters might not be sufficient (i.e custom in-house business application). Thus, we provide
LSSC Editor, a GUI tool, bundled with LSSC, that lets you easily design custom SQL queries for your application.