MRP & Material Requirements Planning: Beginner's Guide

Material Requirements Planning (MRP) sounds complex, but at its core, it answers a simple question: "What materials do I need, and when do I need them?"

This guide breaks down MRP for small manufacturers in plain language.

What is MRP?

MRP is a system that helps you:

Plan: What raw materials to order
Schedule: When to order them
Control: How much to keep in stock

The MRP Calculation

At its simplest:

Materials Needed = (Production Orders × BOM Quantities) − Current Stock

Why Small Manufacturers Should Care

Even if you're small, proper material requirements planning for small manufacturers helps you:

Reduce Stockouts: Never halt production for lack of materials
Cut Costs: Don't tie up cash in excess inventory
Meet Deadlines: Deliver on time, every time

MRP Inputs You Need

1. Master Production Schedule

What are you making, and when?

2. Bill of Materials (BOM)

What components go into each product? Learn how to set up BOM software.

3. Current Inventory

What do you have in stock right now? Use automated low-stock alerts to stay informed.

4. Lead Times

How long does each supplier take to deliver?

Simplified MRP for Small Businesses

You don't need expensive ERP software. Here's a practical approach:

Step 1: List Your Products

Create a simple list of finished goods you manufacture.

Step 2: Create BOMs

For each product, list all raw materials and quantities.

Step 3: Set Reorder Levels

In your inventory software, set minimum stock levels based on:

Weekly usage rate
Supplier lead time (track these in your raw material system)
Safety buffer

Step 4: Review Weekly

Every week, check:

What's below reorder level?
What production orders are coming up?
What needs to be ordered?

How Rekavoze Implements MRP Principles

While Rekavoze doesn't have a full production scheduling module (yet!), it gives you the building blocks for smart production inventory management:

What Rekavoze Does:

Automated Low-Stock Alerts: Get notified when materials hit reorder levels
BOM Cost Tracking: Know exactly what materials go into each product and their costs
Lead Time Tracking: Record supplier delivery times for better planning
Real-Time Inventory: Always know what's in stock

What This Means for You:

Instead of complex MRP software, you get a simple, practical approach:

Set reorder levels based on weekly usage + lead time
Get alerts when it's time to order
Use BOM data to calculate material needs manually or in a spreadsheet
Track actual costs to refine your planning over time

Perfect for manufacturers making under 50 orders per month who need better visibility without enterprise complexity.

Conclusion

You don't need expensive ERP software to apply MRP principles. With smart inventory tracking and alerts, small manufacturers can achieve 80% of the benefit with 20% of the complexity.

Looking for a simple tool to get started? Try free inventory software for Indian manufacturers.

Start planning your materials →