2. Two-level MPS
We will describe successively the logic behind assembling to order and planning bills.
2.1. Assembling to order
In the case of a single finished product, one can envisage manufacturing from stock. One transforms raw materials and components by following all the routing to obtain salable finished products while waiting for a customer order. If we have defined a desired stock level of finished products, the classical MRP2 system manages this type of situation suitably. On the other hand, it becomes impossible to hold several thousand different finished products in stock.
A solution consists in waiting for the customer order to begin manufacturing. However, the customer will not be satisfied with the long lead time: in our example 12 weeks (external purchase 8 weeks, mounting of subsets 2 weeks, final assembly 2 weeks). The lead-time acceptable to the customer is 2 weeks, which means that the order can arrive at the beginning of the final assembly.