Abel’s Material Requirements Planning (MRP)

Posted on 11.04.2013 by Rik

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Gidday, This is the first in a series of blogs I am writing on Abel’s features and what they can do for you.

Abel’s Material Requirements Planning (MRP) is a technique which uses budgets to drive Production Planning and Inventory Control within a business. MRP can be used to plan manufacturing, purchasing and delivery activities.  It recommends re-order quantities and timing for materials, ensuring your supply and demand is efficiently managed while maintaining low inventory levels.  Here’s what MRP can do for you:

  • MRP gives you certainty that you have all necessary components as MRP recommends re-order quantities and timing of  ALL the components needed to make or deliver your products, including labor loadings and machine times.
  • MRP helps you maintain low inventory levels by matching supply to time-based demand from the budgets and recommends ordering the items only when they are needed, while always ensuring you have enough stock to meet anticipated demand.
  • MRP informs you about work group / work center utilization by using routing and labor data in Bills of Materials to forecast factory loadings.
  • MRP can help you build good relationships with your suppliers and customers. Using MRP recommendations, you can give your suppliers accurate forecasts of your purchases, helping you with price negotiations and placing you as a favored customer. Having confidence in your materials flow and pricing gives you a competitive advantage, and more certainty and accuracy in setting and meeting delivery times to your customers.

Abel’s implementation of MRP uses Budgets, Bill of Materials (BOM) and Inventory Data together with the Master Production Schedule to calculate time-phased requirements for materials.  It uses the Budgets to generate recommended Order Quantities for Inventory Items and Production Scheduling for manufactured items.

  • You can switch MRP on or off  for individual Inventory Items and give each its own MRP production settings.
  • Budgets used for MRP can be by product, department, customer or a combination of these.
  • A scheduled MRP process uses your budgets, BOMs and inventory data to generate material requirements for staff engaged in planning and re-ordering activities.

P.S. Though MRP is more commonly used to manage materials and production for manufactured items, it can be used for managing inventory levels of stocked items too.

If you want to know more about Abel’s MRP and how it can help your business, please refer to the Manufacturing and Production section of our website or alternatively contact an Abel Distributor.