Question

Please answer the following question for week #2: This is from page 495 of

Managing Operations Across the Supply Chain by author Morgan Swink

3. Complete the MRP record for a bicycle seat. MRP Record Part Name: Seat Lead time = 1 week On hand = 30 Safety stock = 20 Order quantity: FOQ = 100 Week Week Week Week Week Week Week Week 2 Gross Requirements 7050 7060 80 Scheduled Receipts Available Inventory Net Requirements Planned Order Receipts Planned Order Releases

Answer 1

Answer:

As per the given problem, following information/constraints are identified for managing Operations Across the Supply Chain of Part : Seat

• Lead Time = 1 week
• On hand = 30
• Safety Stock = 20
• Order quantity = 100

Thus, it is evident that no new order can be given, unless inventory level goes below 20. That’s the minimum inventory level has to be maintained.

Based on the above, set of information, the MRP record is constructed below:

	Week 1	Week 2	Week 3	Week 4	Week 5	Week 6	Week 7	Week 8
Gross Requirements	70	50	70	80	70	60	60	80
Scheduled Receipts	30	60	110	40	60	90	30	70
Available Inventory	30	60	110	40	60	90	30	70
Net Requirements	40	-10	-40	40	10	-30	30	10
Planned Order Receipts		100	100	-	100	100	-	100
Planned Order Release	100	100		100	100		100

The net requirement indicates shortage of supply. If it is negative, then it indicates over supply in that specific week. If over supply is less than 20, then new order is released. The units of new order released, are received in the next week as the lead-time is 1 week.

Therefore, in 8 week time span, total five times new order has to be released (last week is not considered as requirement for subsequent weeks are not available).

The answer for week 2 is also covered in the above table, which is again given below:

	Week 2
Gross Requirements	50
Scheduled Receipts	60
Available Inventory	60
Net Requirements	-10
Planned Order Receipts	100
Planned Order Release	100