Material Requirements Planning
Material Requirements Planning (MRP) is a key manufacturing planning process that uses a site’s master schedule and all other sources of demand and supply to:
• Calculate gross item requirements and projected on-hand inventory
• Schedule and plan orders
• Produce action messages
The following topics explains how to create and maintain a material requirements plan.
IntroductionIntroduces MRP and elaborates on MRP’s functions and requirements.
Setting Up MRPOutlines which data to set up in a system before running MRP.
Executing MRPDetails the options and available functions of MRP Processing, Scheduling, Pegged Requirements, and Planning Modes.
Reviewing MRP OutputDescribes MRP’s primary outputs; Action Messages and Planned Orders.
Approving Planned OrdersDetails how to approve planned purchase, work, and line orders using Planned Purchase Order Approval, Planned Work Order Approval, and Planned Repetitive Schedule Approve.
Introduction
Material requirements planning (MRP) balances supply and demand for purchased and manufactured items. Given a set of demands or requirements, MRP automatically calculates a time-phased schedule of planned supply orders or replenishments to satisfy those demands.
MRP looks at demand for finished items and uses product structure information to calculate demand for component items. For each item, MRP looks at the ordering information, the amount currently on hand, and lead times, and generates planned orders suggesting how many of that item to buy or make and when to do so.
MRP and Sites
MRP’s planning activity is performed by site. Each site’s material plan is completely independent from inventory, demand, and supply at other sites. You can run MRP for several sites in succession, but it does not plan for these sites as a group.
For organizations with multiple sites, MRP can be used in conjunction with distribution requirements planning (DRP), which balances supply and demand among sites.
See User Guide: QAD Supply Chain Planning.
Sources of Demand and Supply
MRP uses the master production schedule (MPS) to calculate dependent component demand. Dependent demand is directly derived from the demand for other items, and includes demand for components items, raw materials, and subassemblies.
Independent demand is demand that cannot be calculated or derived from demand for other products. It is represented through forecasts and sales orders, and includes demand for end products and replacement items. Independent demand generally passes to MRP through the master production schedule.
Sources of Demand
MRP considers the following as sources of demand:
• Forecasts
• Sales orders
• Customer scheduled orders from a required ship schedule
• Intersite orders, generated by DRP
• Component requirements from manufacturing
• Production forecasts
• Safety stock requirements
MRP does not consider unconfirmed sales orders or component requirements from batch firm-planned orders as sources of demand.
Sources of Supply
MRP considers the following as sources of supply:
• Nettable quantity on hand (QOH)
• Purchase orders
• Intersite requests, generated by DRP
• Manufacturing orders (work orders and repetitive schedules)
• System-generated work orders resulting from flow scheduled orders
• Quality orders
• Supplier scheduled orders
MRP does not consider blanket purchase orders or non-nettable inventory as sources of supply.