The main purpose of supply planning is to ensure that the required materials and resources are available in the right quantities and at the right time to meet production schedules and customer demand.

MRP helps in calculating the materials needed for production based on sales forecasts, ensuring that materials are ordered in advance to meet production schedules.

Safety stock serves as a buffer to ensure that production continues even in case of unexpected delays or disruptions in the supply chain.

Reorder points trigger the automatic replenishment of stock when inventory levels fall below a predetermined threshold, ensuring materials are available when needed.

Accurate forecasting ensures that businesses can plan for adequate resources and materials, preventing overproduction and stockouts, and optimizing production efficiency.

By aligning production with actual demand, supply planning helps reduce excess inventory, optimize stock levels, and improve cash flow, thereby reducing overall costs.

Demand variability causes fluctuations in inventory levels, making it difficult to align supply with customer demand and requiring flexible supply planning strategies.

Capacity planning ensures that production resources are available to meet demand, preventing bottlenecks and delays in the supply chain.

Supplier performance affects the reliability and timeliness of material deliveries, impacting inventory management and production schedules. Poor supplier performance can lead to stockouts and delays.