Implementing MRP (Material Requirement Planning) for Managing Raw Material Inventory in an Indonesian Plastic Blown Film Company

The inventory costs of raw materials and finished goods for manufacturing companies can reach half of the company's assets. Proficient inventory management is needed to accelerate the production process and prevent overstocking or stock-outs. Raw material inventory planning at the company often experiences overstock of raw materials, which results in material damage and also increases operational storage costs. Therefore, this study aims to implement material requirement planning (MRP) in managing raw material inventories. The Min-Max, Reorder Point (ROP), and Economy Order Quantity (EOQ) methods are used in this research. These three methods are implemented on item code CLKG-15000294 from the PT Sidoraya Utama (PT.SRU) order. The result indicates that the most suitable methods to be implemented according to company conditions are Min-Max and Reorder Point (ROP). The Min-Max method is applied to determine the minimum stock of raw materials, the maximum stock of raw materials, and also the quantity that must be ordered. Meanwhile, the Reorder Point (ROP) method is used as a benchmark for repurchasing after reaching that point. Moreover, the study results also showed that the Min-Max method saved the cost of purchasing PE 1 raw materials by 76.97%, PE 2 raw materials by 64.96%, and PE 3 raw materials by 64.03%.