MRP (Material Requirements Planning)

What it is

MRP starts from demand — confirmed sales orders and a production forecast — and explodes each finished product through its BOM to arrive at gross requirements for every component. It then subtracts what is already in stock and what is already on order, applies minimum stock and batch-size rules, and offsets each requirement by the supplier's lead time. The result is a list of dated purchase suggestions and production orders.

Because it re-runs on live data, MRP is a planning loop rather than a one-time report. When an order is brought forward, a supplier slips or a batch fails quality, the next run shows which requirements have moved and which purchases now need chasing. It was the original core of ERP and remains the heart of any manufacturing system.

Why it matters for a growing business

In a small factory, one experienced person holds this calculation in their head and in a few Excel sheets. As orders, styles and suppliers multiply, that person becomes the bottleneck and the sheets stop agreeing: the same fabric is ordered twice, an accessory is forgotten until the line is waiting for it, or working capital sits in material bought too early.

MRP makes the calculation repeatable and visible. Purchasing sees a dated list of what to buy instead of a pile of requests, management sees which orders are at risk because of a missing component, and the company can hold less safety stock because it trusts the plan. It also gives a defensible answer to the customer's question of when an order can ship.

How AutoProbaho uses it

AutoProbaho builds MRP into its manufacturing and garments ERPs as a module that reads BOMs, stock, open purchase orders and lead times from the same database, and produces purchase suggestions the buyer can review, adjust and convert with one click. Where suppliers communicate by WhatsApp or email, purchase orders and follow-ups can be sent automatically through n8n.