Poultry industry, especially when operating in markets where fresh products are prioritized over frozen ones, has a significant difference in terms of planning compared to other industries, namely; order collection, planning and production take place all in the same day, which puts a significant stress on the planning process while making it even more critical for the survivability of the organization. A routine day consists of order collection with a predetermined cut-off time, planning of orders which must be completed sometime before production start and the production itself followed by dispatching of trucks for order shipments. The fact that market demands mostly fresh products implies that the closer the cut-off time to the production start, the better. And this, in turn, implies that the time allotted for planning must be reduced. Hence, a fast executing planning system creates an important competitive advantage for any player in this industry.

Most of the time, the number to be slaughtered is determined in advance of the production day, independent of the number of orders collected on that day. On the other hand, the main factors which determine the ratio of the number to be slaughtered to be shipped as whole versus as pieces are, the number of operators on hand and the quantity and the quality of the orders collected. Moreover, the decision regarding the exact mix of pieces, i.e., leaving a piece as a whole leg or processing it further to have a thigh and a drumstick, is affected by the orders and capacity constraints on various processing units of the factory.

Another important factor is that because the number to be slaughtered is determined in advance of the production day whereas the orders are collected on the production day, there may be a misfit between the orders and the number to be slaughtered. For example, for a number of 200K chicks to be slaughtered to pieces, the number of wing related orders may require 250K chicks to be slaughtered to pieces whereas the leg related orders may require 150K chicks to be slaughtered to pieces. In such a case, determining which orders are going to be short and how much for pieces in high demand, and, which orders are going to be send in excess and how much as well as the quantity to be frozen for pieces with low demand directly affects the profitability. Furthermore, if the supply chain is structured such that there are different sales regions organized independently, each seeking to maximize its own performance while being supplied by the same factory, then inevitably, during times of high demand each sales region will have an incentive to over order to minimize the under delivery the will receive; and during times of low demand each sales region will have an incentive to under order to minimize the excess delivery they will receive. xS Planner, the planning software of NovaLab, has an embedded mechanism specifically designed for the poultry industry to calculate the objective sales potential of each sales region by considering the observed sales prices and quantities for each region, which helps charting an objective and balanced plan greatly. In addition to this, this process also eliminates the negative effects of the over ordering or under ordering of sales regions.

For the markets where fresh product demands are high, another important consideration is the effect of the dispatching times of the trucks have on production. For example, even when a slaughter of 400K is sufficient to satisfy all orders for wing related pieces, if the dispatching times of trucks for sales regions with a high demand of wing orders are too close to the production start time, this means that some wing orders are not going to be satisfied for these sales regions. Furthermore, this will imply that some sales regions will need to receive extra quantities and possibly a need to freeze some products will rise on the factory side. The planning system must be able to handle these complications arising due to the dispatching times of trucks.

All in all, the pressure to maximize the conformity of production to orders, the fact that order collection and production takes place during the same day, and the number of different constraints including the ones which are not mentioned here render it nearly impossible to chart a plan which satisfies all these different requirements either manually or by an ordinary planning software. xS Planner can satisfy all these requirements and more, while charting a plan in a matter of minutes.

Master Production Scheduling

Master production scheduling module is designed to enable companies to have total control over how to best utilize their resources while matching demand and supply; keeping in mind that the...
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