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SAP MRPWhat is SAP MRP - Material Requirement

PlanningOverview

Material Requirement Planning (SAP MRP) is a tool which helps

in planning the requirement quantities and schedules of a given

material. It not onlyensures availability of the material for whichMRP is carried out, but also ensures availability of the

components (of all the BOM levels) below in the BOMstructure.Apart from assuring material availability, MRP also carries out

scheduling of the procurement proposals using the lead times forthe materials/components. Whenthe material is an internallymanufactured material, it will use the lead times or operation lead

times from the routings/recipes and when the material is an

externalprocured material, it will fetch the lead times or deliverytimes for the material defined at an appropriate place in the

tool/system. Scheduling of the procurementproposals not onlyderives the capacity loading of the orders on the workcenter but it

also calculates the delivery dates of the components that would

be requriedfor manufacturing (delivery date = start date ofprocessing). The output of MRP proposes procurement proposals

(planned order or purchase requests) so as to gaurantee material

availability and at the same time schedulethe procurementproposals using delivery lead times for the materials/components.

Material requirement Planning can be run for purchased materials

or finishedsaleable 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, produceor sell. Itoffers all the possible planning methods available in the market

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like the reorder point planning for the consumption based planned

materials, lot for lotMRP planning for the demand based planningmaterials, forecast based planning methods which uses the past

historical figures to extrapolate the futurerequirements (again aconsumption 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 grossrequirementplanning 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 datasuch as sales orders, forecast, plannedindependent demands (forecasted demand)