![]() MRP is unable to meet the intended purpose of material requirement planning to ensure “ guaranteed material availability on time” This becomes very critical for the Chemical and pharmaceutical industry where material replenishment lead time is high and shelf life falls within the planning horizon. This resulted into manufacturing interruption due to material shortage despite running MRP planning on a regular basis.īatch expiry plays an important role in precise material requirement calculation along the time horizon. However, standard MRP programs don’t take material stock at batch level granularity, hence batch level stock parameters ( Expiry Date, Used by Date, Shelf life, etc.) always stay outside MRP calculation. MRP takes all types of stocks and incoming receipts such as Purchase orders, production orders, Purchase Requisitions (within planning fence), and planned orders (within planning time fence) as firm receipts. Standard SAP – MRP engine performs net requirement calculation by comparing all issue and receipt MRP elements within a plant inside the predefined planning horizon and specified MRP configuration parameters. Each chemical or drug product or APIs(Active pharmaceutical) chemical and physical property retains its permissible characteristics up to a finite number of days which is determined empirically basis on clinical and laboratory experiments and trials.Įxpiry Date = Date of Manufacturing + Shelf Life ( usually maintained in number days) We calculate this value meticulously by looking into the scheduled receipts and on-hand stock over the planning horizon.Īs per 21 CFR Part 211 – Good Manufacturing Practice for Finished Pharmaceuticals established requirements concerning the expiration date on a drug product and stability testing to assure the appropriateness of that date. Time Phased Net requirements= Time phased Gross requirements- (scheduled receipts+ On-hand inventory) Again, a simple net requirements formula can explain that. ![]() After netting, this value is the total amount of materials we need for the next production cycle. In simple terms, we add up the orders scheduled to arrive and the material we have in store and then subtract it from the gross requirements. What is Time phased Net requirement Calculation? MRP engine plans the supply based on requirements and considering the current stock in hand and meets the shortages. In manufacturing, the function of MRP is to guarantee material availability on time. The SAP MRP engine (Material Requirement Planning) is used to plan procure or produce the required material quantities on time for in-house purposes or for fulfilling customer demands or forecasted volume. Also this would help SAP developers and consultants simplified framework to enhance MRP program to suffice client’s need.īefore going into further technical details of the blog, let us understand few key elements of planning. SAP’s MRP engine is the most important and complex component in SAP’s production planning module. ![]() This blog will help the SAP community to solve the long pending problem of non-accountability of batches with expiry dates in Net requirement calculation of SAP-MRP. This is important to find out a systematic solution to account batch level expiry of components in enterprise level material requirement planning in order to streamline material availability on time manufacturing lines and minimize waste due to expiry. This has been a pain area since decades for planning and manufacturing business function. I have been into SAP production planning and supply chain consulting practice for the last 20 years. Product has to be manufactured and sold/consumed before expiry of its shelf life. Life science (Pharmaceutical/Food/Chemical) products always have limited shelf life and also have limited environment exposure life.
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