What is Material Requirements Planning (MRP) in Apache OFBiz

Getting the right materials at the right time is crucial in manufacturing. Too little inventory stops production, too much inventory wastes money. Material Requirements Planning (MRP) solves this problem by determining what, how much, and when raw-materials are required to meet demand, ensuring timely production without excess inventory.

Before diving into Material Requirements Planning (MRP), it’s important to understand two key building blocks of the production process: Bill of Materials (BOM) and Routing in Apache OFBiz.

The BOM defines what components are needed to manufacture a product, while Routing outlines the sequence of operations required to turn those components into a finished item. Together, they form the foundation on which the MRP engine calculates material needs and production schedules.

Apache OFBiz is a powerful open-source system that comes equipped with a strong MRP system. It helps businesses improve procurement, cut costs, and keep production running smoothly. With proper configuration, MRP in Apache OFBiz delivers precise planning and keeps production on track.

This guide explains Material Requirements Planning in Apache OFBiz in simple terms. You'll learn what MRP is, how to run your first MRP Engine in Apache OFBiz, and how to understand the requirements generated by the system. Whether you're new to Apache OFBiz or want to improve your current setup, this guide will help you learn MRP.

What is Material Requirements Planning (MRP)

Material Requirements Planning is a system that calculates what materials you need to manufacture products. It answers three key questions:

• What materials are needed?
• How much do we need?
• When should they arrive?

MRP is a computer-based system that starts with demand (from sales orders or forecasts) and works backward through products Bill of Materials (BOM). It figures out exactly what raw materials, parts, and components you need to buy or make.

Key objectives of MRP:

• Inventory Optimization – Keep inventory as low as possible without running out of stock. MRP calculates exact quantities needed, reducing excess inventory and storage costs.
• Production Planning – Schedule manufacturing based on when materials will be available and how long things take to make. MRP prevents production delays caused by missing parts.
• Material Availability – Make sure all required materials arrive when you need them. MRP coordinates purchase orders and manufacturing schedules.

Understanding MRP in Apache OFBiz

Apache OFBiz MRP Engine Module 

Apache OFBiz includes a built in MRP engine as part of its Manufacturing component, bringing production execution, material planning, and shop floor control into a single system. The engine automatically calculates material requirements using sales orders, forecasts, production schedules, current inventory, and Bills of Materials, so all business data works together without the need for complex integrations.

When you run MRP, Apache OFBiz analyzes the complete product structure, breaks down BOMs level by level, checks available inventory, and determines exactly what needs to be purchased or produced. You can run MRP for a specific warehouse, selected product lines, or the entire operation. The system then generates draft purchase and production orders that can be reviewed, adjusted, and converted into actual orders when ready.

Integration with other modules of Apache OFBiz

Apache OFBiz MRP works seamlessly with other modules:

• Inventory Module – Provides real-time stock levels, warehouse locations, and inventory movements. MRP uses this to calculate what you actually need, considering what's in stock, reserved for other orders, or on its way.
• Purchasing Module - MRP Engine calculates the quantity that needs to be procured and generates purchase requirements. These requirements are reviewed by the procurement manager and then converted into Purchase Orders. Supplier lead time, minimum order quantity, and preferred supplier data are considered during planning to support informed procurement decisions.
• Manufacturing Module – Connects production orders with material needs. When MRP determines you need to manufacture something, it creates draft production orders that consider routing, work center capacity, and how long manufacturing takes.
• Order Management – Feeds sales orders and forecasts into MRP as demand. This ensures your material plans match customer orders.

This integration eliminates disconnected systems and manual data entry, creating a single source of truth for material planning across your company

MRP Calculation Logic in Apache OFBiz

MRP engine algorithm in Apache OFBiz uses the following formula to calculate the Required Quantity for each item:

For a deeper explanation of this formula and the logic behind it, refer to the Confluence document on the internal workings of MRP in Apache OFBiz.

Running MRP in Apache OFBiz

Material Requirement Planning in Apache OFBiz is executed after product structures and dependencies are in place. Once the Bill of Materials and Routings are defined, the MRP engine evaluates demand, available supply, and production capacity to generate actionable requirements.

Run the MRP Process
MRP is initiated for a selected facility and planning period. During execution, Apache OFBiz analyzes existing inventory, open orders, and approved production data  and uses the formula explained above  to calculate material and production needs.

Review Generated Requirements
After the run completes, MRP produces a list of proposed requirements. These requirements specify what needs to be manufactured internally or procured externally, along with required quantities and required by dates.

Approve Requirements
Proposed requirements are reviewed and approved by planners. Once approved, they become the basis for creating production runs and purchase orders.

For a detailed, configuration level walkthrough with screen references and examples, refer to the step by step Material Requirement Planning documentation on Apache OFBiz Confluence.

Conclusion

MRP in Apache OFBiz provides an efficient and integrated approach to managing material requirements and production planning. It ensures that materials are available when needed, optimizes inventory levels, and keeps production aligned with demand. With its seamless automation and flexibility, Apache OFBiz helps businesses improve coordination across purchasing, manufacturing, and inventory operations.