SAP MRP

What is SAP MRP - Material Requirement Planning Overview

Material Requirement Planning (SAP MRP) is a tool which helps in planning the
requirement quantities and schedules of a given material. It not only
ensures availability of the material for which MRP is carried out, but also
ensures availability of the components (of all the BOM levels) below in the BOM
structure.


Apart from assuring material availability, MRP also carries out scheduling of the
procurement proposals using the lead times for the materials/components. When
the material is an internally manufactured material, it will use the lead times or
operation lead times from the routings/recipes and when the material is an external
procured material, it will fetch the lead times or delivery times for the material
defined at an appropriate place in the tool/system. Scheduling of the procurement
proposals not only derives the capacity loading of the orders on the workcenter but
it also calculates the delivery dates of the components that would be requried for
manufacturing (delivery date = start date of processing).


The output of MRP proposes procurement proposals (planned order or purchase
requests) so as to gaurantee material availability and at the same time schedule
the procurement proposals using delivery lead times for the materials/components.
Material requirement Planning can be run for purchased materials or finished
saleable materials or subassemblies (semi-finished) used in production.


While the Material Requirement Planning in SAP ECC (SAP MRP), derives a plan
for the materials and helps the planners and supervisors to purchase, produce or
sell. It offers all the possible planning methods available in the market like the
reorder point planning for the consumption based planned materials, lot for lot
MRP planning for the demand based planning materials, forecast based planning
methods which uses the past historical figures to extrapolate the future
requirements (again a consumption based planning material).


SAP material requirement planning or SAP MRP, uses the following factors in its
planing run:


a) planning strategies - made to order or made to stock or its variations

b) planning types - type of the MRP run, i.e., consumption based planning methods
or demand based planning methods and net requirement planing or gross
requirement planning

c) lot sizing procedures set for the material

d) master data such as BOM or Routings/Recipes, quota arrangements, souce list,
vendors, purchase info records. customer masters etc, and transaction data such
as sales orders, forecast, planned independent demands (forecasted demand)