Consumption-based planning is a planning procedure that uses past consumption data to calculate the future requirements of materials. It does not consider the dependent requirements of higher-level materials, but only the independent requirements from sales orders, forecasts, or stock transfers. Consumption-based planning is suitable for B and C materials, which have low value, low demand variability, and high availability. Consumption-based planning reduces the planning efforts for these materials, as it does not require the maintenance of BOMs, routings, or production versions. Consumption-based planning can be further divided into reorder point planning, forecast-based planning, and time-phased planning, depending on the method of determining the reorder point and the lot size12 Reference:
Consumption-Based Planning - SAP Help Portal
SAP S/4HANA Production Planning and Manufacturing Certification Guide, Chapter 3: Material Requirements Planning, Section 3.1: Planning Procedures, Page 67