Setting the "Inventory constraint flag" of an item to "Yes" and checking the property "Enable inventory constraints" of the scheduling parameter settings will specify inventory constraints on the item.
If the quantity of an inventory constrained item required for an operation is insufficient, the operation will be regarded as an inventory constraint violation and assigned to a dummy resource.
The quantity of order 02 is 30 and the required quantity of ProductA-MATERIAL is 30 but the quantity of an inventory order for ProductA-MATERIAL is 20. Inventory constraints are not enabled in the scheduling below. Since pegging is performed even when there are no inventory constraints, order 02 is assigned later than the inventory order.
If inventory constraints are enabled for ProductA-MATERIAL, operation 2:10 will be in violation of inventory constraints because the quantity of ProductA-MATERIAL is not enough to cover the quantity required for operation 2:10. As a result, operation 2:10 will be assigned to a dummy resource and so will be later processes.
Since orders are pegged even when inventories are not constrained, the assignment of order 2 is affected by the date of the inventory order. If you make a setting, for example, specify "FALSE" for the pegging condition as in the diagram below, so that the orders will not be pegged, order 2 will not be affected by the time to which the inventory order is assigned. This setting is useful when you want to assign manufacturing orders irrespective of assigned times of inventory orders but still want to consider the quantities of the manufacturing orders when displaying the inventory graph.