Material Requirement Planning (MRP) Software
From the orders you have to the material you need — what to buy, how much, and by when, worked out from BOMs, stock and open orders.
In short
Material requirement planning (MRP) works out what to buy and make, how much and by when: it takes demand from sales orders or the master schedule, explodes the bills of material, subtracts stock and open orders, and shows the net shortfall for each item. CRE8Rx ERP shows each shortfall with a suggested action — manufacture, raise a requisition or buy.
| Full form | Material Requirement Planning |
|---|---|
| Inputs | Demand, BOMs, stock, open orders |
| Output | Net requirement by item and date |
| Suggested action | Manufacture, raise a requisition, or buy |
Material requirement planning (MRP) is the calculation that turns a production plan into a list of what to buy and make. It takes demand — sales orders or a master production schedule — explodes it through the bill of materials, subtracts stock on hand and material already on order, and shows the net shortfall for every item, with the date it is needed.
MRP meaning in one line: right material, right quantity, right time. Done by hand on a spreadsheet it is slow and goes out of date the moment an order changes; done by MRP software it is a run you repeat whenever demand moves.
What you get
MRP runs
Run MRP against sales orders or the master production schedule and see gross requirement, stock, on-order and net requirement for every item.
Multi-level BOM explosion
Sub-assemblies are exploded down to raw material, so a shortage of a bought-out part three levels down still shows up.
Master production schedule
Plan what to make week by week in the MPS and feed it straight into MRP.
A suggested action per item
Each shortage comes with the suggested action — manufacture, raise a requisition or buy — for planning and purchase to act on.
Stock and open POs counted
Available stock by warehouse and material already on order are netted off, so you do not buy twice.
Work orders for make items
Items you manufacture are planned as work orders with operations and work centres; releasing one creates its job cards.
An MRP run, step by step
- 1Two sales orders need 20 SS work tables in three weeks.
- 2MRP explodes the BOM: each table needs 4.5 kg SS sheet, 4 castor wheels and a fastener set — 90 kg sheet, 80 castors and 20 sets in all.
- 3Stock shows 40 kg of sheet and 100 castors; a purchase order for 30 kg sheet is already open.
- 4Net requirement: 20 kg sheet, no castors, 20 fastener sets.
- 5MRP suggests buying the sheet and fasteners; purchase raises the requisition so they arrive before the work order starts.
What is material requirement planning?
MRP was developed for manufacturers whose products are built from many components with different lead times. Its inputs are the demand (what must be made and when), the bill of materials (what each product is made of), inventory records (what is in stock) and open orders (what is already coming). Its output is a time-phased list of planned orders.
MRP II — manufacturing resource planning — extends the same idea to machine and labour capacity. ERP extends it further to the whole business, which is why MRP is one module inside an ERP rather than a separate system.
Why MRP results go wrong
MRP is only as good as its inputs. A BOM that is out of date, stock that has not been posted, or a purchase order that was received but never entered will all produce a confident, wrong answer. That is why MRP works best inside an ERP where BOMs, stores and purchase are the same system — the inputs are the transactions themselves.
MRP vs reorder level
A reorder level buys when stock falls to a fixed point, which suits consumables used steadily. MRP buys for specific orders, which suits components whose demand depends on what is being made. Most factories use both: MRP for BOM items, reorder levels for consumables.
Questions people ask.
What is the meaning of MRP in manufacturing?
Material Requirement Planning — calculating what materials and components are needed, in what quantity and by when, from demand, the bill of materials, stock and open orders.
What are the inputs of MRP?
Demand (sales orders or a master production schedule), the bill of materials, inventory on hand, and open purchase and work orders.
What is the difference between MRP and MRP II?
MRP plans materials. MRP II, manufacturing resource planning, also plans capacity — machines and labour — and connects to finance.
Is MRP the same as ERP?
No. MRP is one module of an ERP. ERP covers the whole business — sales, purchase, stores, production, quality, accounts and HR — with MRP as its planning engine.
How often should MRP be run?
Whenever demand changes materially — commonly daily or weekly. Because it reads live stock and orders, each run reflects the current position.
Related parts of the system
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The useful version of a demo uses your own item list and last month's orders, not ours.
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