Material Requirements Planning

Material Requirements Planning is a procedure to determine how much of each item is needed and how much of that item is needed in order to manufacture specific number of units in given time period.  It is most commonly used in industries where a number of products service are made in batches and where assembly operations are used.

Material Requirements PlanningIn MRP, each unit of final product is exploded into its constituents. The components of the final product are called BOM (Bill of Material). Once the components and their required quantities are known, MRP tries to find out the time at which the required components of the final product are needed with the help of lead time of each component. (Orlicky. J, 1975)

Thus MRP tries to create the schedule of arrival and production of each and every component of the final product in required quantities by calculating the required quantities from BOM and performing reverse calculations.

Data Analysis-

From the data given in the problem given, the MRP calculation was done manually by the use of excel. Read more  : Get Expert Custom Assignment Help Online From Hobart

Assumptions-

  • The components which are common to both the trolleys are treated separately and calculation done is independent for both the type of trolleys
  • The lot sizing is done on EOQ basis and thus the planned orders were in the multiple of EOQ.
  • The safety stock was maintained at required level all the time and there was no consumption from the safety stock for the production.

Material Requirements Planning

The analysis calculates the quantity and the time at which various components were required based on the demands of Deep trolley and Shallow Trolley from customers and the inventory of all the components present at week1 and scheduled receipts. See More:

The lead time was of the essence during the calculation as it was the determining factor for release of orders.

The Data Analysis for the Deep Trolley manufacturing shows that-

  • Quantity of TD1 that must be ordered at week 5 is 125 and at week 7 is 230.
  • Quantity of X1 that must be ordered at week 4 is 450 and at week 6 is 900.
  • Quantity of TD11 that must be ordered at week 3 is 300 and at week 5 is 450.
  • Quantity of TD12 that must be ordered at week 3 is 150 and at week 5 is 200.
  • Quantity of X2 that must be ordered at week 4 is 250 and at week 6 is 1000.
  • Quantity of X3 that must be ordered at week 4 is 1000 and at week 6 is 2000.
  • Quantity of X4 that must be ordered at week 4 is 40 and at week 6 is 40.
  • Quantity of X7 that must be ordered at week 4 is 1000.
  • Quantity of TD121 that must be ordered at week 2 is 300 and at week 4 is 375.
  • Quantity of TD122 that must be ordered at week 1 is 150 and at week 3 is 200.
  • Quantity of X5 that must be ordered at week 2 is 500 and at week 4 is 700.
  • Quantity of X6 that must be ordered at week 2 is 160.
  • Quantity of X8 that must be ordered at week 2 is 500 and at week 4 is 200.

The Data Analysis for the Shallow Trolley manufacturing shows that-

  • Quantity of TS1 that must be ordered at week 6 is 190 and at week 8 is 340.
  • Quantity of X1 that must be ordered at week 5 is 700 and at week 7 is 1350.
  • Quantity of TS11 that must be ordered at week 4 is 375 and at week 6 is 675.
  • Quantity of TS12 that must be ordered at week 4 is 200 and at week 6 is 350.
  • Quantity of X2 that must be ordered at week 5 is 750 and at week 7 is 1250.
  • Quantity of X3 that must be ordered at week 5 is 1500 and at week 7 is 3000.
  • Quantity of X4 that must be ordered at week 5 is 40 and at week 7 is 40.
  • Quantity of X7 that must be ordered at week 3 is 500 and at week 5 is 1000.
  • Quantity of TS121 that must be ordered at week 3 is 375 and at week 5 is 675.
  • Quantity of TS122 that must be ordered at week 2 is 200 and at week 4 is 300.
  • Quantity of X5 that must be ordered at week 3 is 600 and at week 5 is 1300.
  • Quantity of X6 that must be ordered at week 3 is 160 and at week 5 is 320.
  • Quantity of X8 that must be ordered at week 1 is 500 and at week 3 is 500.

Critical Appraisal-

The analysis of Deep Trolley MRP shows that most of the components were having low inventory in hand throughout the 10 weeks period. It shows that the EOQ calculated and mentioned for all these components were correctly estimated. However for component X3 and X8 the on hand inventory was very high which tells that the demand wasn’t predicted correctly in order to calculate EOQ for these two components. Thus it is necessary to estimate the demand for these components more correctly which will result in lower on hand inventory by correctly estimating the EOQ. See More:

The analysis of Shallow Trolley MRP shows that except a few components, all of thcomponents were having low inventory in hand throughout the 10 weeks period. It shows that the EOQ calculated and mentioned for all theses component were correctly estimated. However for component X3, TS121 and TS122 the on hand inventory was very high which tells that the demand wasn’t predicted correctly in order to calculate EOQ for these two components. Thus it is necessary to estimate the demand for these components more correctly which will result in lower on hand inventory by correctly estimating the EOQ. Order Now