The SAP Business One Material Requirements Planning (MRP) module enables you to plan material requirements for a manufacturing or procurement process based on the evaluation of existing inventories, demands, and supplies on changing planning parameters (such as lead time determination, make or buy decisions, and holiday planning).
SAP Business One MRP calculates gross requirements for the highest bill of materials (BoM) level, based on existing inventory, sales orders, purchase orders, production orders, forecasts, and so on. It calculates gross requirements at the lowest BOM levels by carrying down net parent demands through the BOM structure. Dependent levels might have their own requirements, based on sales orders and forecasts.
The results of the MRP run are report and recommendations that fulfil gross requirements by taking into consideration the existing inventory levels and existing purchase orders and production orders. The MRP run also takes into account predefined planning rules such as Order Multiple, Order Interval, Minimum Order Quantity, Inventory Level, and so on.
In many cases, production companies receive sales orders on short notice. However, the production process might take a great deal of time. As a result, it is common for these companies to plan their purchasing and production in advance, even before they receive actual sales orders. This is the goal of a forecast. A forecast is designed to serve as an additional requirement. Therefore, the goods are produced based on the forecast, and when the actual sales orders are received, the company is able to supply the order quickly.
SAP Business One lets you generate forecasts based on historical sales records or manually entered forecast quantities. You can then use the forecasts as an additional data source for the MRP calculation.
Use the SAP Business One Production module to create and maintain the following:
• Bill of Materials (BOMs) – specifes the quantities of components that make up a product.
• Production Orders – a set of instructions for planning and assembling a production item. It tracks all the material transactions and costs involved in the production process, as well as additional costs, such as labor overhead.
SAP Business One supports the following types of production orders:
• Standard – used for regular production. Components are copied from the item BOM.
• Special – used to produce items or perform activities on the shop foor that are not based on the Standard BOM.
• Disassembly – used to report the disassembly of an item with a production BOM. Components are copied from the item BOM.
A finished product may be the result of an entire production process, or a collection of items that are sold as a unit, but are not the output of a production or assembly process.