Material requirement planning (MRP) has, for the past 30 years, been helping manufacturers deal with production planning, scheduling, and inventory control. It has become an indispensable manufacturing management system for manufacturers in a highly competitive market. Advancements in technology have made MRP even more cost-efficient, but manufacturers may not be fully aware of its capabilities. So to help you understand the benefits of MRP, we’ve answered eight frequently asked questions about MRP.
How can MRP optimize inventory levels?
With the help of an MRP system, your manufacturing firm can achieve a level of inventory management necessary to realize efficiency.
An MRP system uses data from your production schedule, which can help you determine the exact level and cost of inventory needed to meet your production demands. This way, you can set consistent and optimum levels of inventory to reduce carrying costs during a production period.
Do MRP systems forecast materials and parts needs?
To streamline production, you need to intelligently plan the purchase of raw materials by accurately determining available raw materials and the right time to procure missing components.
This can be simplified with an MRP system that can automatically track production steps, identify raw materials to be purchased, check production schedules, and determine material deliveries. From there, procurement managers can configure the system to contact suppliers automatically when certain raw materials need to be purchased.
How do MRPs shorten production lines?
In connection to purchase planning, an MRP system can detect bottlenecks caused by a deficit in raw materials and parts in your production line. In response to material availability constraints, the system helps manufacturers better plan their production lines by working around them.
It can prioritize or divert your resources towards the production line where materials are sufficient and, it can also prioritize a particular stage of production over another stage where materials are deficient.
What's the best way to revise production scheduling?
By using the information on available inventory, an MRP system can help you predict expected production yield and set production times based on this information. It does so by helping your managers see the production process more clearly, allowing them to control hourly operations, equipment, and labor tasks better, as well as accurately predict labor time and operational costs, reducing costs and inefficiencies.
Do MRPs enhance raw material allocation?
An MRP will allow you to efficiently allocate raw material quantities in production processes by giving you control and ready information about raw materials' availability, as well as their expected yield. The system will also indicate the resources you still need, such as extra labor, equipment, and other operational assets — and at what time.
What's the best way to process manufacturing data?
MRPs help you analyze, handle, and present huge amounts of manufacturing data and allow you to process and document purchase data, inventory data, deliveries and cash flow data, invoices, lists, reports, and others.
Can SMB software make raw materials purchasing more efficient?
MRP systems optimize purchases, saving manufacturers from paying unnecessary costs. Since it shows the quantity and the cost of raw materials needed, you can make the most economically viable purchases. This takes into account the costs of shipping, storage, and carrying.
How can manufacturers reduce back-office burdens?
Given that MRP systems are fully automated, they save a great deal of time spent on manual tasks, especially in inventory, purchases, and production management. Because of the accuracy involved in automation, human errors are reduced.
You can find out more about MRP and IT support for manufacturing from us. At SpectrumWise, we understand the challenges of manufacturing, and that's why we offer a comprehensive portfolio of customized industry IT solutions. Give us a call to start experiencing the benefits for yourself.