Track: Supply Chain and Logisitcs Competition

Abstract

Industrial has been growing rapidly in line with increasing needs from consumers, making competition stronger. To continue developing and competing with competitors, a company must increase the productivity in order to meet consumer needs. PT. XYZ produces metal fitting products with make-to-order principle. This study aims to plan and control the number of raw materials used in production to minimize costs without reducing the quality of the products. The Material Requirement Planning (MRP) method is recommended because it can help raw material procurement to be more effective and efficient. Moreover, implementing safety stock system anticipates sudden fluctuations in demand. Thus, the company will not lose the opportunity to meet consumer needs as scheduled in the first place with minimum possible cost. In this case, the use of MRP method with Wagner Within Algorithm (AWW) lot-sizing technique will result in the lowest costs compared to Economic Order Quantity (EOQ), Period Order Quantity (POQ), Lot for Lot (LFL), Silver Meal Algorithm, and Least Unit Cost (LUC). Using the AWW lot-sizing, the order and storage costs of raw materials will be saving Rp1,285,135 with a percentage of 19% compared to the usual method PT. XYZ usually used.