Manufacturing · Daily operations · 10 min read

Plan with MRP and handle material shortages

Record demand, run material requirements planning, firm the proposals, and fix components that are short.

Before you begin

• The MRP and planned orders switch is on.
• Products you make have an active BOM. Components you buy may have a supplier in their planning parameter.
• You hold manufacturing.plan, and manufacturing.firm to firm proposals.

Steps

Set planning parameters

1. Go to Manufacturing > Planning > MRP and click New parameter.
2. Choose the Product and, if needed, a Warehouse (empty means any).
3. Choose the Policy: Make to stock, Make to order, Buy or Transfer. Production is proposed only for products with a BOM and the policy Make to stock or Make to order.
4. Enter Lead time (days), Safety stock, Minimum lot, Lot multiple and the Supplier.
5. Save. There is one parameter per product and warehouse.

Record demand

Confirmed sales orders appear automatically under Manufacturing > Planning > Demand > Sales Orders, less what has been delivered. Draft orders are not listed. To add other demand, click New demand, choose the Kind (Forecast, Manual or Project), Product, Qty, Due date, and optionally warehouse, project, customer and Scenario (default base).

Run MRP

1. On Planning > MRP enter the Scenario (empty is base) and Horizon to (empty is today plus the MRP horizon from the settings).
2. Click Run MRP.
3. Click See planned orders.

Firm the proposals

1. Open Manufacturing > Planning > Planned Orders.
2. For each proposal on the Planned tab choose Firm, Review or Cancel.
3. A production proposal becomes a manufacturing order, planned at once. A purchase proposal becomes a draft purchase order at the product's cost. The row then shows "Became MO-..." or the purchase order number.

Fix a shortage

1. Go to Manufacturing > Planning > Material Shortages. Each row shows required, available, short quantity and the expected receipt (red if after the order starts).
2. Choose Purchase Request, enter the Supplier and Qty, and save. A draft purchase order and a firmed planned order pegged to the MO are made.
3. Or choose Use Substitute, or Reschedule MO to start the day after the earliest receipt.

What happens next

Worked example. OT-1000 has 5 on hand, confirmed sales demand of 25, safety stock 3, minimum lot 10, multiple 5, lead time 2 days, nothing incoming. The net need is 3 - (5 - 25) = 23, raised to a multiple of 5 gives 25. A production proposal for 25 starts two days before the due date and is pegged to the sales order. The BOM of those 25 tables creates proposals for 25 table tops, 100 legs and 400 screws, less their stock and incoming supply.

A re-run replaces the unfirmed proposals of that scenario and keeps firmed ones. A firmed one no longer needed is flagged '<code>: firmed supply exceeds demand by N (demand M).'

Good to know

• A purchase proposal with no supplier goes to Review: 'No supplier - choose one to firm it.'
• If the start date would fall in the past, it moves to today with an expedite exception.
• Firming twice: 'This proposal is already decided.' A proposal that became an order is cancelled on that order: 'A firmed proposal that became an order is cancelled on that order.'
• Rescheduling with no incoming purchase order: 'No supply is coming - choose the new start yourself.'
• Release with short components is refused unless the setting allows it; see Create, plan and release a manufacturing order.
• Turning MRP off removes the Demand and MRP menus and refuses running, firming and saving demand.