MRP Report (Material Requirement Planning)
MRP Report (Material Requirement Planning) - User Guide
1. Introduction 🧠
The MRP (Material Requirement Planning) Report is the “brain” of the manufacturing system. Its primary job is to answer three critical questions:
- What do we need to make or buy?
- How much do we need?
- When do we need it?
By analyzing current sales demand, existing production plans, and warehouse stock levels, the MRP engine ensures that production never stops due to missing parts, while preventing expensive over-stocking of raw materials.
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Key Objectives:
- Uninterrupted Production: Ensure all materials are available for the planned manufacturing batches.
- Inventory Optimization: Buy only what is needed, considering current stock and items already in transit.
- Fulfillment Accuracy: Link customer sales orders directly to the production and procurement floor.
2. Planning Modules 🚀
A. Production Plan (The “What to Make” List)
Focuses on Finished Goods (FG) and Semi-Finished (SA) requirements.
- Gross Requirement: Total units needed as per the selected production plan.
- Net Requirement: Gross requirement minus current warehouse stock and pending sales orders.
B. Procurement Plan (The “What to Buy” List)
Focuses on Raw Materials (RM) and components.
- BOM Explosion: The system takes your production goal and “breaks it down” into every single nut, bolt, and raw material required using the Bill of Materials.
- Purchase Calculation:
Buy Qty = (BOM Requirement + Safety Stock) - (Current Warehouse Stock + Pending Purchase Orders).
C. Full Kit Plan (The “Readiness Check”)
An audit tool used by production supervisors. It checks if 100% of the materials required for a specific job are physically available in the “Ready-to-Use” state.
- Purpose: Prevents starting a machine setup only to realize a critical component is missing mid-way.
3. Analysis Toggles & Controls 🛠️
- Add Pending Order Qty: Includes all unfulfilled customer sales orders (from the last 2 years) into the production requirement.
- Deduct FG Stock: If you already have 100 units of an item in the finished goods store, the MRP will subtract this from your production goal.
- Deduct RM Stock: Automatically looks at the Raw Material store and reduces the procurement list by the amount already available.
- Scan BOM of Sub-Assemblies: Crucial for multi-stage manufacturing. It ensures that even small sub-parts made in-house are planned for.
4. Understanding Supply Intelligence 📊
The report doesn’t just look at stock; it looks at the Supply Pipeline:
- Pending Indent Qty: Materials you have already requested from the purchase department.
- QA Pending Qty: Materials that have arrived at the gate but are currently undergoing quality testing. These aren’t “in stock” yet, but will be soon.
- Re-Order Level (ROL): If the calculated requirement is less than the item’s safety stock level, the MRP will recommend a higher “Make Indent Qty” to maintain a buffer.
5. Source Transactions 🔄
The planning engine synthesizes data from:
- Production Plans: Your roadmap for the month/week.
- Sales Orders: Customer demand.
- BOM Master: The recipe for every finished product.
- Inventory Snapshot: Current real-time stock levels.
- Purchase Pipeline: Status of open indents and GRNs.
6. Best Practices / Tips 💡
- Full Kit Discipline: Never release a job to the shop floor without running the Full Kit Plan. Starting a job with “90% availability” usually leads to bottlenecks and idle machine time.
- Order Cleanup: Ensure your Sales Orders are closed if they are no longer valid. If old orders remain “Open,” the MRP will keep recommending you buy material for them.
- Lead Time Buffer: When reviewing the Procurement Plan, remember that the “Make Indent Qty” doesn’t account for shipping time. Always cross-check with the Lead Time Audit in the Consumption Report.
- Alternate UOMs: Pay attention to the Alternate Make Indent Qty column if you buy in one unit (e.g., Kgs) but consume in another (e.g., Meters). The report handles this conversion automatically based on the factor defined in the Item Master.