Article
February 2024
MRP your biggest saviour
Using OurSys's Material Requirement Planning (MRP) can cut down delivery lead time drastically and at the same time will reduce the inventory cost.
Why to use the MRP
MRP calculates the net material shortfall based on the Bill of Material for the order after considering open sales orders, available unallocated stock, pipeline stock, reorder levels, MOQ and the EOQ.
This accurate calculation eliminates excess purchase and production. Thus inventory cost is reduced.
Since the MRP considers the full Bill of Material, components are never missed.
Without MRP the process of calculating shortfall is extremely time consuming and prone to errors. And these errors may lead to delay of deliveries to the customer and an inventory pileup.
What are the pre-requisites for running the MRP program?
The most important pre-requisites are:
- Item master with no duplicates
- Accurate bill of material
- Accurate stock figures
- Correctly defined reorder, minimum levels, minimum order quantities and economic order quantities
Why do companies struggle to use the MRP program?
The most important reasons are:
- Lack of awareness of the tremendous benefits in terms of time and inventory savings.
- Inaccurate Stock because of lag in data entry
- Herculean task of correcting the Bill of Material and Item codes
- Getting the team to do real time data entry
What variations of MRP are available in OurSys
The variations of MRP in OurSys are:
- MRP with stock allocation
- MRP without stock allocation
- MRP without considering current stock
How can OurSys team help you to start using MRP
Here is how we can help you:
- Arrange for a special training session for your team
- Help you to correct reorder level, minimum level, MOQ & EOQ in one go
- Arrange for an expert who can help you overcome hurdles in implementing MRP
- Recommend the right MRP variant
In this digital world it is impossible to think of running a manufacturing unit without running MRP and yet it baffles us that so many companies still are stuck in the old manual error prone method.
Feedback
Was this article useful to you? Do let us know how we can further improve. Your feedback is precious to us.
Please click here to give us your feedback.
