What is distribution requirements planning in SAP PP - Production Planning and Control?

SAP Term: distribution requirements planning

• Component: PP

• Component Name: Production Planning and Control

• Description: A function that allows the optimization of inventory replenishment at warehouses in a multilevel distribution network. Stockouts and shipping costs can be reduced without an increase in overall stock levels.

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• Key Concepts: 
  Distribution Requirements Planning (DRP) is a component of SAP Production Planning and Control (PP) that helps to optimize the supply chain by forecasting and planning the distribution of goods. It enables companies to plan and manage their inventory levels, production schedules, and delivery times. DRP also helps to identify potential problems in the supply chain and provides solutions to ensure that goods are delivered on time. 
  
  How to use it: 
  DRP can be used to create a forecast of demand for goods, which can then be used to plan production and delivery schedules. It can also be used to identify potential problems in the supply chain, such as delays in delivery or shortages of materials. DRP can also be used to optimize inventory levels by analyzing current stock levels and predicting future demand. 
  
  Tips & Tricks: 
  When using DRP, it is important to ensure that the data used for forecasting is accurate and up-to-date. It is also important to consider any external factors that may affect the supply chain, such as changes in customer demand or changes in the availability of materials. 
  
  Related Information: 
  DRP is closely related to other components of SAP Production Planning and Control, such as Material Requirements Planning (MRP) and Capacity Requirements Planning (CRP). These components work together to ensure that production and delivery schedules are optimized for maximum efficiency.