MRP stands for Material Requirements Planning, a computer-based system used in the manufacturing industry to help manage the inventory of raw materials, components, and finished goods. MRP is used to plan and schedule the production of products based on their demand, ensuring that the necessary materials are available at the right time and in the right quantities to meet production requirements.
The MRP system uses information such as the production schedule, inventory levels, and bill of materials (BOM) to determine the quantities and timing of the materials needed to meet production goals. By automating these processes, MRP can help improve the accuracy of inventory management, reduce stockouts and shortages, and minimize the costs of holding excess inventory. This can lead to more efficient production processes and better customer satisfaction.