1. Lot sizing:
1.1. It is to unify the calculated net requirements by a certain unit considering cost reduction and work efficiency.
1.2. L4L
1.2.1. it's a lot for lot just means that you can order the exact amount of materials needed whereas like a fixed quantity ordering system
1.3. EOQ- Economic Order Quantity
1.3.1. refers to the best order quantity to make the total cost minimum by considering the balance between ordering cost and inventory carrying cost, which are contradictory.
1.4. Least Total Cost- LTC
1.4.1. calculates the order quantity by comparing the carrying cost and the setup or ordering costs for various lot sizes and then selects the lot in which these are most nearly equal.
1.5. Least Unit Cost- LUC
1.5.1. setup + inventory carrying cost) over successive periods by adding the total carrying costs to the setup costs and finding the period for which the cost per unit is the smallest.
2. MRP is most valuable to companies invloved in assembly operations
3. Material Requirements Planning (MRP):
3.1. is a planning system used to ensure the right quantities of materials are available when needed.
3.2. MRP includes:
3.2.1. the number of materials needed for product production
3.2.2. how long it will take to get from the supplier to the production facility.
3.2.3. when to order materials based on delivery lead times
3.3. Three important functions
3.3.1. Order planning and control.
3.3.2. Priority planning and control.
3.3.3. Provision of a basis for planning capacity requirements and development of board business plans.
4. MRP has three inputs:
4.1. Master Production Schedule- MPS
4.1.1. specifies the timing of each good to be produced.
4.1.2. Time Fences is to maintain a reasonably controlled flow through the production system.
4.2. Bill Of Materials- BOM
4.2.1. (product structure file or product tree) :specifies the raw materials needed to build the product and the sequence in which the product is created.
4.3. Inventory records file
4.3.1. is a collection of the inventory information.