9. Material Requirements Planning (MRP)

Procurement and Purchasing Defined

Acquiring materials is the next logical step after the planning process is complete as it is the net result of the planning process, whether for raw materials and components for manufacturing or finished goods for wholesalers, distributors, or retailers.

Because purchased materials, components, and services make up a great deal of the supply chain spending for most organizations, it is a very visible and important component of supply chain management. (Chapter 1, “Lean Supply Chain and Technology: A Perfect Combination,” discusses this leverage effect.)

Purchasing is a basic function in most organizations, and for the purposes of this book is defined as the transactional ...

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