MRP - Term Overview

Home | MRP - Term Overview

The material planning or MRP is a system used by companies for administration and planning, normally associated with software that does. What this program does is plan production and control inventory, which benefits companies enormously. Its objective is that the company has all the necessary supplies, or materials required at the right time to meet the needs of customers.

MRP characteristics

The MRP can provide a list of suggestions for purchase orders to suppliers, yes, it needs to be programmed to do so. But it's not your only objective, you also have to secure materials and products so that they are available for production and of course, for delivery to customers. He is also in charge of maintaining adequate inventory levels for the operation, and planning manufacturing activities, delivery schedules, and purchasing activities.

MRP is a very complete and beneficial system for companies, and it must satisfy a series of conditions: make sure that the products and materials requested for production are distributed to customers; keeping inventory to a minimum and planning activities such as manufacturing, delivery, and purchasing. But the MRP system is only acceptable where there are particular conditions. For example, when the final product is complex and requires several levels of preparation or when the final product is expensive, that the processing time of the material and component is quite long, that the production cycle of the product (lead time) is long, or if the process is characterized by items with dependent demands and manufacturing be intermittent.

The objective of this system is to reduce the volume of stocks at the time the purchase or manufacturing order enters.

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