DRP & DRP II

DRP is a systematic process for determining which goods, in what quantity, at which location, and when are required in meeting anticipated demand. This inventory related information is then entered into a manufacturing requirements planning (MRP-I) system as gross requirements for estimating input flows and production schedules.
DRP II is an extended version of distribution requirement planning (DRP-I) process which includes provision for key non-inventory resources such as labor, material handling facilities, and storage space. This information is then entered into a manufacturing resources planning (MRP-II) system as gross requirements for estimating input flows and production schedules.

DRP is the function of determining the need to replenish inventory at branch warehouses. A timephased order point approach is used where the planned orders at the branch warehouse level are “exploded” via MRP logic to become gross requirements on the supplying source. In the case of multilevel distribution networks, this explosion process can continue down through the various levels of regional warehouses (master warehouse, factory warehouse, etc.) and become input to the master production schedule. Demand on the supplying sources is recognized as dependent and standard MRP logic applies. More generally, replenishment inventory calculations, which may be based on other planning approaches such as period order quantities or “replace exactly what was used,” rather than being limited to the time-phased order point approach”.

In certain cases where the distribution is for a limited number of items, but a balance must be maintained between multiple warehouse sites, master schedules based on actual schedules sales orders and sales forecasts may be used to drive the planning process through standard DRP logic. This may result in master production schedules for one or more production sites.

The Objectives: The objectives of Distribution Resource Planning (DRP) in are

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  To improve customer service levels by anticipating customer demand at distribution centers and providing finished products at the correct location when customer needs arise.
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  To provide an accurate requirements plan for manufacturing.

The Planning Horizon: It is the number of periods in the future for time phased records in DRP systems
must be planned when the system is designed. In general the planning horizon should extend far enough
into the future to cover the sum of all lead times from the beginning to the end of the manufacturing
process through the delivery to the final distribution point.

Frequency of Re-planning: Re-planning can be performed either periodically or continually using systemic net change regeneration. With periodic re-planning the TPOP records are recreated on a regular cycle, usually corresponding to the length of each period in the display. At the time of re-planning the current period’s plans disappears, period 2 becomes period 1, 3 becomes 2 & so fourth with a new
forecast added to the first week in the horizon. With continual planning all data are maintained on a perpetual basis with updating of inventory, forecast & order data based on transactions as they occur usually in real time. This creates a much ore dynamic system that can react quickly to changes as they occur. With net change regeneration only those products that have had unplanned activities posted
against them since the last regeneration will be processed & regenerated.

DRP II
“The extension of distribution requirements planning into the planning of the key resources contained in a distribution system: warehouse space, workforce, money, trucks, freight cars, etc.” It includes many of the physical aspects of distribution such as warehousing & transportation facilities. It also implies the connection of the replenishment system to financial systems & the use of simulation as a
means to improve system performance.

Transportation Loading under DRP:
The ability of DRP to plan shipments in advance constitutes a significant opportunity to plan for transportation needs. Full truck or railcar loads, together with selecting optimum size delivery containers & vehicles improves the efficiency of the transportation function. In addition the forward visibility of needs helps preclude the need for costly expedited shipments at premium shipping rates.