DISTRIBUTIION REQUIREMENT PLANNING

(DRP)

Logistics

Logistics usually refers to management of:

the movement of materials within the factory
the shipment of incoming materials from suppliers
the shipment of outgoing products to customers

Movement of Materials within Factories

The typical locations from/to which material is moved:
Incoming
Vehicles

Receiving
Dock

Quality
Control

Warehouse

Work
Center

Other Work
Centers

Packaging

Finished
Goods

Shipping

Shipping
Dock

Outgoing
Vehicles
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Shipments To and From Factories

Traffic
Traffic departments routinely examine shipping
schedules and select:
shipping methods
time tables
ways of expediting deliveries
Traffic management is a specialized field requiring
technical training in Department of Transportation
(DOT) and Interstate Commerce Commission
(ICC) regulations and rates.

Shipments To and From Factories

Distribution
Distribution, or physical distribution, is the
shipment of finished goods through the
distribution system to customers.
A distribution system is the network of shipping
and receiving points starting with the factory and
ending with the customers.

Shipments To and From Factories

Distribution Requirements Planning

DRP is the planning for the replenishment of
regional warehouse inventories.
DRP uses MRP-type logic to translate regional
warehouse requirements into central distributioncenter requirements, which are then translated into
gross requirements in the MPS at the factory.

Shipments To and From Factories

Distribution Requirements Planning

Scheduled receipts are previously-placed orders that
are expected to arrive in a given week
Planned receipt of shipments are orders planned, but
not yet placed, for the future
Projected ending inventory is computed as:
Previous weeks projected ending inventory
+ Planned receipt of shipments in current week
+ Scheduled receipt of shipments in current week
-- Forecasted demand in current week

Shipments To and From Factories

DRP Time-Phased Order Point Record

Region. Warehouse #1 LT = 1
Std. Quantity = 50
SS = 10
Forecasted demand (units)
Scheduled receipts
Projected ending inventory
Planned receipt of shipments
Planned orders for shipments

Week
-1

30

40

30

40

40

40

10

20

30

50

50

50
60

80

50

50

Shipments To and From Factories

Contoh DRP Time-Phased Order Point Record

Region. Warehouse #1 LT = 3
Std. Quantity = 50
SS = 10
Forecasted demand (units)
Scheduled receipts
Projected ending inventory
Planned receipt of shipments
Planned orders for shipments

Week
-1

160

40

30

40

40

40

10

20

30

50

50

150
60

40

50

50

Example: DRP
Products are shipped from a companys main
distribution center (adjacent to the factory) to two
regional warehouses. The DRP records on the next
two slides show for the two regional warehouse
the forecasted demand, scheduled receipts, and last
weeks projected ending inventories for a single
product.
The third upcoming slide shows for the main
distribution center scheduled receipts and last
weeks projected ending inventory for the same
product. Complete the DRP records.
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Example: DRP

DRP Record for Regional Warehouse #1

Region. Warehouse #1 LT = 1
Std. Quantity = 100
SS = 50
Forecasted demand (units)
Scheduled receipts
Projected ending inventory
Planned receipt of shipments
Planned orders for shipments

Week
-1

80

100

80

60

100

100
200

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Example: DRP

DRP Record for Regional Warehouse #2

Region. Warehouse #2 LT = 2
Std. Quantity = 200
SS = 80
Forecasted demand (units)
Scheduled receipts
Projected ending inventory
Planned receipt of shipments
Planned orders for shipments

Week
-1

100 200 200 240 200

200
220

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Example: DRP

DRP Record for Main Distribution Center

Main Distrib. Center LT = 1

Std. Quantity = 500
SS = 200
Gross Requirements (units)
Scheduled receipts
Projected ending inventory
Planned receipt of shipments
Planned orders for shipments

Week
-1

500
250

13

Example: DRP

Completed DRP Record for Regional Warehouse #1

Region. Warehouse #1 LT = 1
Std. Quantity = 100
SS = 50
Forecasted demand (units)
Scheduled receipts
Projected ending inventory
Planned receipt of shipments
Planned orders for shipments

Week
-1

80

100

80

60

100

200 220 120 140

80

80

100
100
100

100
100

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Example: DRP

Completed DRP Record for Regional Warehouse #2

Region. Warehouse #2 LT = 2
Std. Quantity = 200
SS = 80
Forecasted demand (units)
Scheduled receipts
Projected ending inventory
Planned receipt of shipments
Planned orders for shipments

Week
-1

100 200 200 240 200

200
220 320 120 120

80

80

200 200 200

200 200 200

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Example: DRP

DRP Record for Main Distribution Center

The gross requirement ( in row 1) for any week
is determined by summing the planned orders for
shipment for the same week at the two regional
warehouses
These gross requirements at the MDC are input to
the master production schedule in the factory
In other words, the timing and quantities of
production in the factory are linked to the timing
and quantities of demand at the regional
warehouses

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Example: DRP

Completed DRP Record for Main Distribution Center

Main Distrib. Center LT = 1

Std. Quantity = 500
SS = 200
Forecasted demand (units)
Scheduled receipts
Projected ending inventory
Planned receipt of shipments
Planned orders for shipments

Week
-1

200 300 200 100

500
250 550 250 550 450 450
500
500

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Shipments To and From Factories

Distribution Resource Planning

Distribution resource planning extends DRP so
that the key resources of warehouse space,
workers, cash, and vehicles are provided in the
correct quantities at the correct times.

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