Yield refers to the ratio of the actual output quantity of a product to the planned or expected input quantity of raw materials or components used in the production process. It is often expressed as a percentage and is a key performance indicator (KPI) used to measure the efficiency and effectiveness of the production process.
Yield provides insights into how effectively the manufacturing process is converting raw materials into finished products. A high yield indicates that the production process is efficient and is minimizing waste, while a low yield might indicate issues such as inefficiencies, quality problems, or inaccurate material measurements.
The formula to calculate yield is:
For a certain product that has a planned input quantity of 100 kilograms of a raw material; after the production process is complete, the actual output quantity is measured to be 95 kilograms. The yield would be calculated as follows:
A yield of 95% indicates that the production process yielded 95 kilograms of finished product for every 100 kilograms of raw material used.
In Dynamics 365 for Supply Chain Management, each formula version can have a yield specified via Product Information Management > Bills of materials and formulas > Formulas. In the example below a yield of 80% has been entered.
When a batch order is created and estimated for this product, the quantity of raw material that is expected to be used is increased using an 80% yield. The estimated raw materials usage would be calculated as follows (Actual Output Quantity / Yield x 100%):
- M6008 – 800 / 80 x 100% = 1000 lb
- M6009 – 600 /80 x 100% = 750 lb
This would ensure the correct quantity of raw material can be purchased based on the expected yield of that product.