Available-to-Promise (ATP) is a supply chain metric that represents the quantity of a product that can be promised to customers for future delivery, based on current inventory on hand plus planned incoming supply minus already-committed customer orders.
Understanding Available-to-Promise (ATP)
ATP gives sales and customer service teams a real-time answer to the question: "How much can we commit to a customer right now?" Without ATP visibility, teams either over-promise (leading to fulfillment failures) or under-promise (leaving revenue on the table).
In CPG order management , ATP is calculated dynamically as orders are placed and inventory changes. Each time a customer order is committed, the available quantity is reduced. When new purchase orders are received or production runs complete, ATP increases.
ATP is distinct from total on-hand inventory. A brand may have 1,000 units in stock but 800 already allocated to existing orders, leaving an ATP of only 200 for new commitments.
Core Components of the ATP Calculation
The basic ATP calculation uses three inputs: on-hand inventory (the quantity of the product currently in stock), incoming supply (quantities expected from open purchase orders, production runs, or transfers scheduled within a defined time window), and committed orders (quantities already allocated to customer orders that have not yet shipped).
The basic formula is: ATP = On-Hand Inventory + Incoming Supply - Committed Orders
More sophisticated ATP systems also factor in safety stock reserves (inventory held back as a buffer and not available for commitment), lead time windows for incoming supply, and allocation rules that prioritize certain customers or channels.
ATP in Practice
Order management systems and ERP s calculate ATP in real time as orders are entered. When a customer places an order, the system checks ATP for the requested SKU and quantity before confirming the delivery date.
If ATP is insufficient for the full order quantity, the system may offer a partial shipment with a backorder for the remainder, a later delivery date based on incoming supply, or substitution with an alternative SKU.
DOSS and other CPG order management platforms surface ATP by SKU and warehouse location, allowing customer-facing teams to commit orders accurately and operations teams to manage allocation rules across channels.
Related Concepts
- Inventory Management : ATP is calculated from live inventory data maintained in the inventory management system.
- Order Management : ATP drives order commitment decisions within the order management workflow.
- Safety Stock : safety stock reserves reduce the ATP available for new orders, protecting against demand spikes and supply disruptions.
- Supplier Lead Time : incoming supply in the ATP calculation is scheduled based on supplier lead times.
- Demand Planning : accurate demand forecasts improve ATP planning by anticipating future supply needs before orders arrive.
