Configuring landed cost optimization

Sterling Order Management System Software enables you to specify landed cost parameters to be considered for evaluation during order promising, if the "Cost, Number of Shipments" optimization type has been selected in your scheduling rule.

1. From the tree in the application rules side panel, choose Cross Application > Order Promising > Sourcing And Scheduling > Landed Cost.

The Landed Cost window displays in the work area.

2. Enter information into the applicable fields. Refer to Table 1 for field value descriptions.
3. Choose the Save icon.

   Table 1. Landed cost window.

   Landed cost field value descriptions

   Field	Description
   Use Landed Cost	Check this box to enable the use of landed cost optimization. Uncheck this box to disable all options in this window.
   Use Item Cost	Check this box to indicate that item cost should be used when computing landed cost.
   Use Transportation Cost	Check this box to indicate that transportation cost criteria should be used when computing landed cost.
   Transfers
   Transfer Cost Factor Currency	Select the currency used for the transfer cost factor from the drop-down list.
   Transfer Cost Factor for Internal Transfers	Enter the transfer cost factor and select the correct UOMs for internal transfers. The internal transfer cost factor is used to calculate transfer cost when there is a transfer schedule between two nodes. Note: The value of the Transfer Cost Factor Per Unit specified in the Transfer Schedule pop-up window overrides the value of the Transfer Cost Factor for the internal transfers.
   Transfer Cost Factor for External Transfers	Enter the transfer cost factor and select the correct UOMs for external transfers. The external transfer cost factor is used when a transfer schedule does not exist between two nodes. Note: The value of the Transfer Cost Factor Per Unit specified in the Transfer Schedule pop-up window overrides the value of the Transfer Cost Factor for the internal transfers.
   Last Leg Transportation
   Outbound Constraints	Choose the Details icon to open the Outbound Constraints window, where you can configure outbound constraints and define routing guides.
   For Transportation Cost Based On Number Of Cartons, Assume Maximum Volume Per Carton To Be	Enter a volume and volume UOM to be used when transportation cost is based on the number of cartons.
   Use Handling Cost	Check this box to indicate that handling cost should be used when computing landed cost. Unchecking this box disables the Enterprise Node Type Rules inner panel. For more information about defining enterprise node type rules, see Defining enterprise node type rules.
   Convert Node Attributes Into Cost	Check this box to use the attributes of the node to be converted into cost.
   Node Cost Factor Currency	Choose the currency for computing the cost of node attributes from the drop-down list. To create a new currency, choose the Create New icon and enter information in the applicable fields. For more information about defining the currency for the node attributes cost factor, see Currency Details.
   Node Priority Cost Factor	Enter the node priority cost factor. This factor applies to the distance of the node to the customer to determine the cost of shipping from a node. During scheduling optimization, when the system compares two possible nodes to determine the best one to use during costing, the cost will be based on the node that has the closest proximity to the customer. You can enter values to this field only when the "Convert Node Attributes Into Cost" check box is enabled. When this check box is enabled, Sterling Order Management System Software calculates the shipping cost from the node, based on the factor entered in this field. For example, if the node priority is based on geography, and if you have a node that is 300 miles away and a factor of $0.20, the system calculates the shipping cost for this node to be $60.00, assuming USD.
   Node Consumption Percentage Cost Factor	Enter the node consumption percentage cost factor. This factor applies to the consumed capacity percentage to determine the cost of shipping from a node. During scheduling optimization, when the system compares two possible nodes to determine the best one to use during costing, the cost will be based on the lowest consumption factor. You can enter values to this field only when the "Convert Node Attributes Into Cost" check box is enabled. When this check box is enabled, Sterling Order Management System Software calculates the node's available capacity based on the factor entered in this field. For example, if you have 30% available capacity and a factor of 2, the system calculates the cost for this node to be $60.00, assuming USD.
   Use Node Attribute Costs on Per Unit Basis	Check this box to calculate node attribute codes on a per-unit basis. When enabled, all node attribute-related costs are calculated on a per-unit basis. Node attribute-related costs include node priority cost, node consumption cost, hours of supply cost, and shipment delay cost.
   Hours of Supply Cost Factor	Enter the Hours of Supply Cost Factor. You can enter values to this field only when the "Convert Node Attributes Into Cost" check box is enabled. If "Calculate Node Attribute Costs on Per Unit Basis" is enabled, the hours of supply cost is calculated on a per-unit basis. The Hours of Supply Cost Factor applies to the hours of supply cost at the node. The hours of supply cost is based on the hours of supply remaining at the node, which is calculated using the node's available supply and item velocity. During scheduling optimization, when the system compares nodes to determine the less expensive node for sourcing, the Hours of Supply Cost Factor determines the weight that the system applies to the hours of supply cost in the cost calculation.
   Shipment Delay Cost Factor	Enter the Shipment Delay Cost Factor. You can enter values to this field only when the "Convert Node Attributes Into Cost" check box is enabled. If "Calculate Node Attribute Costs on Per Unit Basis" is enabled, the shipment delay cost is calculated on a per-unit basis. The Shipment Delay Cost Factor applies to the shipment delay cost, which is the cost that is based on the number of days that are required to deliver a shipment to the customer. During scheduling optimization, when the system compares nodes to determine the less expensive node for sourcing, the Shipment Delay Cost Factor determines the weight that the system applies to the shipment delay cost in the cost calculation.