What is Capacity Requirements Planning?
The tools and techniques required to ensure that the organization and its staff can keep up with supply chain demand are referred to as capacity requirement planning (CRP). Projecting future needs and taking action to meet them are involved in this planning. Capacity planning enables you to assess your current capacity.
Significance of Capacity Requirements Planning in E-commerce Logistics
Capacity requirements planning can benefit both couriers and dispatchers. They can assist you in managing delivery and improving customer service. You can reduce the risk of not being capable of meeting supply chain demand by carefully managing your capacity. The following are the additional advantages of capacity requirements planning:
- It provides proper planning of how to use the resources.
- Making the necessary modifications to account for fluctuations in demand or other factors
- Increased customer satisfaction
- It is also crucial if you want to expand the business or if there is a sudden rise in demand for the product.
Pre-requisites of Capacity Requirements Planning and How It Works
The capacity requirements planning work ensures that the necessary resources are accessible when you need them. If you are expected to deliver more products in the next week, capacity planning provides statistics on the required workforce and trucks to match the demand. The following are the prerequisites for capacity requirements planning:
- Production plan
- Current capacity details
- Logistics future demand
- Identification of possibilities when the demand rises
- Details of workforce size
- Details of vehicles and their capacity.
Use Case With Capacity Requirements Planning
Capacity requirements planning ensures that you are prepared to meet unexpected variations in demand. For example, suppose you’re an online seller, and your product suddenly becomes extremely popular. You must now increase your labor and equipment to accommodate the increased demand. Here capacity requirements planning plays a vital role by balancing the supply chain demand.