Materials Requirement Planning - MRP

What is 'Materials Requirement Planning - MRP'

One of the first software based integrated information systems designed to improve productivity for businesses. A materials requirement planning (MRP) information system is a sales forecast-based system used to schedule raw material deliveries and quantities, given assumptions of machine and labor units required to fulfill a sales forecast.

BREAKING DOWN 'Materials Requirement Planning - MRP'

MRP was the earliest of the integrated information systems dealing with improvements in productivity for businesses with the use of computers and software technology to provide meaningful data to managers. With the advent of such systems, production efficiency could be greatly improved. As the analysis of data and the technology to capture it became more sophisticated, more comprehensive systems were developed to integrate MRP with other aspects of the manufacturing process.

RELATED TERMS
  1. Manufacturing Resource Planning ...

    An integrated information system used by businesses. Manufacturing ...
  2. Closed Loop MRP

    A system used for production planning and inventory control, ...
  3. Marginal Revenue Product - MRP

    The change in revenue that results from the addition of one extra ...
  4. Raw Materials

    A material or substance used in the primary production or manufacturing ...
  5. Financial System

    A financial system can be defined at the global, regional or ...
  6. Accounting Information System - ...

    The collection, storage and processing of financial and accounting ...
Related Articles
  1. Economics

    Explaining Marginal Revenue Product

    Marginal revenue product (MRP) accounts for the change in revenue that results from the addition of one extra unit, keeping all other factors equal.
  2. Trading Systems & Software

    Trading Systems: Designing Your System - Part 2

    The preceding section on designing a trading system examines the different types of markets in which to trade, and takes a look at the two basic genres of trading systems: trend-following and ...
  3. Trading Systems & Software

    Trading Systems: Designing Your System - Part 1

    The preceding section of this tutorial looked at the elements that make up a trading system and discussed the advantages and disadvantages of using such a system in a live trading environment. ...
  4. Trading Systems & Software

    Trading Systems: What Is A Trading System?

    A trading system is simply a group of specific rules, or parameters, that determine entry and exit points for a given equity. These points, known as signals, are often marked on a chart in real ...
  5. Trading Systems & Software

    Trading Systems: Constructing A System

    So far, we have discussed the basic components of trading systems, the criteria they have to meet, and some of the many empirical decisions that a system designer must make. In this section, ...
  6. Professionals

    Components of Marginal Product and Marginal Revenue

    CFA Level 1 - Components of Marginal Product and Marginal Revenue
  7. Professionals

    Data Integrity Analyst: Job Description & Average Salary

    Learn about the average salary of a data integrity analyst and the required skills, education and previous experience needed to fill this role.
  8. Economics

    Inside National Payment Systems

    Investopedia explains: The global interconnection of U.S. payment systems makes commerical and financial transfers possible.
  9. Professionals

    A Day In The Life Of A System Trader

    Systems traders divide their time between trading, developing, backtesting, optimizing and forward testing, to create viable and high-probability trading systems.
  10. Economics

    How Does a Company Use Raw Materials?

    Raw materials are the basic components of a finished product.
RELATED FAQS
  1. On which financial statement does a company list its raw material costs?

    Discover what items are raw materials, how raw material costs affect businesses, and where these costs are recorded on a ... Read Answer >>
  2. What is the difference between a capitalist system and a free market system?

    Learn about capitalist and free market systems, how these economic systems function and the main difference between capitalism ... Read Answer >>
  3. What are some examples of prime cost items?

    Learn about prime cost, including the definition of raw materials and direct labor, and how the types of expenses included ... Read Answer >>
  4. What causes human capital to depreciate?

    Read about what life events may cause a worker's human capital to depreciate, both in absolute terms and relative value compared ... Read Answer >>
  5. What is the best reason to pursue a backward integration?

    Learn if backward integration is a good or bad move for a business. Learn what backward integration does for a business's ... Read Answer >>
  6. Does a company logo change require a material disclosable event?

    A company logo change usually constitutes a material disclosable event. Securities law requires that companies disclose all ... Read Answer >>
Hot Definitions
  1. Law Of Demand

    A microeconomic law that states that, all other factors being equal, as the price of a good or service increases, consumer ...
  2. Cost Of Debt

    The effective rate that a company pays on its current debt. This can be measured in either before- or after-tax returns; ...
  3. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  4. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  5. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  6. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
Trading Center