What is net requirement calculation in SAP PP-MRP - Material Requirements Planning?

SAP Term: net requirement calculation

• Component: PP-MRP

• Component Name: Material Requirements Planning

• Description: A check performed by the system to determine whether the requirements are covered by available warehouse stock and planned receipts from the purchasing department or from production. If the forecast requirements are not covered, the system generates a procurement proposal.

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• Key Concepts: 
  Net requirement calculation is a component of SAP's Material Requirements Planning (PP-MRP) module. It is used to determine the amount of material needed to meet customer demand. The calculation takes into account the current stock levels, planned orders, and forecasted demand. It then calculates the net requirement for each material, which is the difference between the demand and the available stock. 
  
  How to use it: 
  Net requirement calculation can be used to plan production and procurement activities. It helps to ensure that there is enough material available to meet customer demand. To use it, enter the current stock levels, planned orders, and forecasted demand into the system. The system will then calculate the net requirement for each material. 
  
  Tips & Tricks: 
  It is important to keep track of stock levels and planned orders in order to get accurate net requirement calculations. Additionally, it is important to update the forecasted demand regularly in order to ensure that the calculations are up-to-date. 
  
  Related Information: 
  Net requirement calculation is part of SAP's Material Requirements Planning (PP-MRP) module. Other components of this module include capacity planning, material availability check, and procurement proposals.