Priority-based planning in Dynamics 365 Supply Chain Management allows businesses to prioritize replenishment orders based on urgency. This means that urgent demands, such as stockout replenishment orders, are addressed before less critical ones, like standard refill orders. This approach helps improve service levels, reduce inventory, and optimize the use of available materials.

Demand-driven planning enhances supply chain management by enabling companies to prioritize replenishment orders effectively. It can automatically split larger orders into smaller ones based on priority, ensuring that high-priority orders are processed first. This method can lead to improved customer service, reduced lead times, and optimized inventory levels, ultimately lowering total supply chain costs.

Dynamics 365 Supply Chain Management offers several capabilities for managing planning priorities, including the ability to assign planning priorities to various order types, set reorder points for item coverage, and automatically split replenishment orders based on priority. Additionally, users can define priority ranges and create intercompany orders to establish a cohesive planning priority flow across different legal entities.