Question

A company with an extensive distribution network would most likely choose a drp system because: (learning outcome: differentiate between an mrp reorder point, and drp logic) ________:

a. it has a network of remote distribution facilities.
b. it has a multiechelon supply channel.
c. it produces the finished goods it sells to the marketplace.
d. it needs to determine accurate order quantities for the channel facilities.

Answer 1

A company with an extensive distribution network would most likely choose a DRP system because it has a multiechelon supply channel. A DRP system helps the company determine accurate order quantities for the channel facilities.

Step-by-step explanation:

A company with an extensive distribution network would most likely choose a DRP (Distribution Resource Planning) system because it has a multiechelon supply channel. The multiechelon supply channel refers to a network of distribution facilities, such as warehouses or distribution centers, that are strategically located at different levels or tiers. These facilities are responsible for storing and distributing products to various geographic regions.

A DRP system helps the company manage and optimize its distribution network by determining accurate order quantities for the channel facilities. It considers factors like demand forecasts, inventory levels, transportation capacities, and lead times to calculate the appropriate order quantities for each facility. By utilizing a DRP system, the company can ensure efficient stock replenishment and timely availability of products in different regions.