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Distribution Requirement Planning

Bill of distribution

The bill of distribution (BOD) specifies how a product is further distributed within your enterprise following inward delivery from the supplier before being passed on to the customer. The concept is similar to the way BOM links component items to their assembly parents. In case of BOM when a demand is posted on a parent assembly item the MRP processor references the assembly’s BOM & explodes the requirement through the product structure, placing demand on the component parts.

DRP Terms

In VMI a manufacturer or distributor assumes the role of inventory planning for the customer. Extensive information sharing is required so that the manufacturer/distributor can maintain a high degree of visibility of its goods at the customer’s location. Instead of the customer reordering when its supply has been exhausted, the supplier is responsible for replenishing and stocking the customer at appropriate levels. Wal-Mart has mastered VMI and is the company against which many other organizations benchmark themselves (1).

Distribution System

The overall goal of a distribution system is to provide products & services in an efficient, timely &
cost-effective manner to multiple customers.

Distribution of products often creates a hierarchy of stocking locations. These include manufacturing
centers, distribution centers, wholesalers & retailers. These locations constitute the supply chain from
original producer to ultimate consumer.

Demand management in MPC system

The position of the demand management in the MPC is shown in the above fig.
It is the key connection to the market place in the front end of the MPC system.

The Demand management is a gateway module in MPC system, providing the link to the market place, SOP & MPS. The communication between DM & market place are two way communications - gathering information from the customer & informing customer the status of the order.

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