Material Requirements Planning (or MRP) may be something that you’ve heard mentioned quite a lot in the manufacturing sphere.
In this post we’ll explain what MRP is, why it’s important, and why it’s even better in DELMIAWorks.
What is Material Requirements Planning (MRP)?
Material Requirements Planning can be defined quite simply as a system that calculates the materials and components required to manufacture a product.
The MRP runs a number of complex calculations, across three simple steps, to ensure you have exactly the right quantities of materials and components, exactly when you need them.
The process looks like this:
- Analyse what materials and components you currently have on hand
- Calculate what additional materials and components are required to complete the production run
- Order the correct stock quantities into your warehouse, to be on hand for the date they are required
And the great thing is that rather than looking at single jobs in isolation, it can factor in all of your jobs when making the calculations.
So you don’t need to worry if you have different production runs that are using the same materials or components.
Why use MRP in manufacturing?
With your MRP system being able to to run complex calculations and order exactly what you need for exactly when you need it, it brings some significant benefits to your business:
1. Reducing the stock burden on your business
Knowing exactly what you need, exactly when you need it means you don’t have to keep large amounts of unnecessary stock on hand at any given time.
2. Improve the cash flow situation of your business
Exactly as above, if you know exactly when certain stock is going to be required, then you don’t need to spend money purchasing stock that you may not even need until six months down the line.
3. Increase productivity in your manufacturing process
Ensuring you’ve got the required stock on hand at the exact moment in time that you need it allows you to run an efficient and lean manufacturing process.
Material Requirements Planning in DELMIAWorks Manufacturing Software
Does Material Requirements Planning sound like something that would be beneficial to your manufacturing operation?
Well here’s why it’s even better in DELMIAWorks.
Set safety stock levels
If you’ve ever had the experience of not having a material or component in stock, right when you’ve needed it, then this ones for you.
DELMIAWorks MRP lets you assign safety stock levels, to ensure you always have the same amount of something in stock at all times.
This provides you with a buffer of the material or component to ensure that you never run out!
You can also set specific reorder points and quantities, to make sure a set amount is ordered every time a specific stock level is hit.
Synchronise with the Forecasting module
Want to know what stock you’re going to need before an order has even been received?
Thankfully you can with DELMIAWorks synchronising the MRP with its Forecasting module.
It allows us to create a production-level forecast that will drive demand through to the MRP system.
For example, let’s say you’re anticipating a 10% growth in the following year.
You can push this information from the Forecasting module into the MRP system.
Based on the figures you enter, it will tell you what changes and implications it will have on your stock levels in the year to come.
This can come in particularly useful when you work with a customer who increases their order quantities with you by a set amount each year.
Through this synchronisation you can gain visibility over your stock requirements before any orders have even been placed.
Labour capacity planning
DELMIAWorks MRP is incorporated into it’s ERP (Enterprise Resource Planning) solution and allows the system to span activities throughout the entire supply chain.
This lets the MRP tap into the labour requirements for a job and measure the standard labour hours against the required hours to meet your schedule.
It lets you calculate the available labour by category and by qualifications and then gives you the power to schedule the operators based on their skill level.
Want to learn more about how DELMIWorks could help you run a more lean, productive manufacturing operation?
Posted by Rob on 8th February 2022.